Gastech 2012 Day Two (1)

2012 Conference & Exhibition Newspaper

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Day Two, Tuesday, 9 October 2012

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Technological advances related to the exporting of liquefied natural gas (LNG) are poised to make the market increas-ingly global in coming years and decades, according to a Statoil executive.

Helge Lund, President and CEO of the Norwegian state company, said that added integration will benefit both consumers and producers.

“We are facing an exciting gas future,” said Lund, who spoke in Monday morn-ing’s Executive Leadership Panel session. “Going forward, we see natural gas as more of a global commodity, for which competi-tion will be fiercer.”

Lund believes that the changing market dynamics are due largely to technical and commercial innovation in North America, where unconventional gas resources, such as shale, are changing the dynamics.

“If ever a game-changer in the energy sector, we are seeing one now in terms of increased availability of natural gas,” Lund said.

“The U.S. has become self-sufficient in gas, and this completely changed their

position around from importer to exporter of LNG.”

That newfound position for the U.S. is already having global impacts, he explained.

“I think it’s fair to observe that the unconventional gas revolution has not only altered the North American market, but also other markets affected by both pipe-line and LNG, such as Europe,” Lund said.

Europe already imports significant quantities of LNG, he noted, and there are estimates that Europe will rely even more on imports after 2015, as its production is on the decline, excluding Norway.

Thus, a link has already been estab-lished between Asian and European gas markets, particularly in LNG. Long-term, this will lead to greater gas market integra-tion, he said.

“We are convinced that this integration will benefit both consumers and indus-tries, as well as producers,” Lund said. “It can stimulate stronger price convergence,

Helge lund (second from left), President & CEO, Statoil, speaks during The Executive Leadership Panel. Other panel members pictured include Martin Houston (far left), COO & Executive Director, BG Group; sHigeru Muraki (third from left), Exec. V.P. and Chief Executive, Energy Solution Division, Tokyo Gas Co. Ltd; kHalid sultan al-kuwari, Marketing and Shipping Executive, RasGas Company Limited; and djeloul BacHi-Bensaad, Director of Production Division, Upstream, Sonatrach.See STaToil, page 19

Statoil sees increasingly global LNG marketBen DuBoSe

sir Frank cHapMan, BG Group, is photographed moments after he cut the ceremonial ribbon to begin the Gastech Exhibition.

“We are good at gas, and we like gas.” With that one sentence, Secretary of State for Energy & Climate Change Edward Davey reaffirmed that the UK government remains committed to further development of the country’s natural gas market.

Delivering the Ministerial Keynote address at Gastech yesterday morning, Secretary Davey noted that “Over £22 bil-lion of natural gas were sold in the UK last year, making it is the single, most important fuel in the UK’s energy mix. Gas fulfills 68% of our heating needs and constitutes 34% of our primary energy use. For some time yet, gas will be as important to the UK as in the past.”

Davey reminded the audience that Brit-ain has a unique position as a gas corridor for Europe. “We directly access the inter-national LNG market here, and we have great connections with the Continent. In 2011, the UK was the world’s third-larg-est LNG importer, with volumes totaling around 25 billion cubic meters, about a quarter of our total gas consumption.” Furthermore, pointed out the Secretary, Britain has a long track record of finding, extracting or trading gas.

Giving a nod to the environmental side, Davey said, “Of course, we all know that,

Energy secretary reaffirms commitment to natural gasKurT aBraham

rt. Hon. edward davey, MP, Secretary of State for Energy and Climate Change, addresses Gastech.See energy SecreTary, page 19

Gastech Conference & Exhibition Newspaper 2 Tuesday, 9 October 2012

Conference Programme, Tuesday, 9 OctobercoMMercial tracks

MorningMarket outlook

09:00–09:10 chairman’s welcome■ De la Rey Venter, Global Head of LNG,

Upstream International, Shell09:10–09:30 one Billion More users by 2030: the un and iea challenge to the world gas industry

■ Kimball Chen, Chairman and Chief Executive Officer, Energy Transportation Group, Inc.

09:35–09:55 global gas prices—Bear or Bull?■ Noel Tomnay, Head of Global Gas Research,

Wood Mackenzie10:00–10:20 outlook for the natural gas Market in japan and tokyo gas group’s 2020 Future vision

■ Kunio Nohata, Senior General Manager Gas Resources Dept., Tokyo Gas Co. Ltd.

10:25–10:45 assessing the impact of the great east earthquake on japanese lng imports and shipping demand

■ Mike Rowley, Director, LNG Shipping, Mitsui OSK Bulk Shipping

10:45–11:15 Break11:15–11:35 recent structural evolutions of the international lng industry

■ Andrew Walker, Vice President, Global LNG, BG Group

■ Elizabeth Spomer, Senior Vice President, Business Development, BG Group

11:40–12:00 latest trends and developments impacting development in lng projects

■ Philip Olivier, President, GDF SUEZ Global LNG

12:05–12:25 why the global gas Market is Full of surprises

■ Catherine Verdier, Vice President, Market Expertise, Strategy, Markets and IT, Total Gas and Power

12:30–12:50 Future pricing of internationally-traded gas: regionalised, globalised or cartelised?

■ Prof. Jonathan Stern, Chairman and Senior Research Fellow—Natural Gas Programme, Oxford Institute for Energy Studies

reserve paper: why oil linkage in lng contracts will remain a Mainstay in the east

■ Dr. Fereidun Fesharaki, Chairman, FACTS Global Energy

12:50–14:10 delegate lunch

aFternoonnatural gas and lng projects

14:10–14:20 chairman’s welcome■ David Ledesma, Energy and Strategy

Consultant, South-Court Ltd14:20–14:40 additional Myths about lng

■ Christopher Caswell, LNG Technology Manager, KBR

14:45–15:05 no More Mr nice guy? does today’s lng Market challenge lng project operations?

■ Peter Thompson, Manager, Gas Strategies15:10–15:30 cameroon lng: converting stranded gas into valuable resources, and unlocking the gas exploration potential

■ Raphael Tilot, General Director, Head Cameroon LNG Project, GDF SUEZ Global LNG

15:35–15:55 successfully executing the Barzan gas project■ Ahmed Tayeeb, Project Engineering

Specialist, RasGas Company Limited15:55–16:20 Break16:25–16:45 community engagement and effective partnerships: a social license to operate

■ Julie Nelson, Director of Public and Government Affairs, BG Group

16:50–17:10 new natural gas and lng project development risks and economic realities

■ Colin Harrison, Senior Consultant— Downstream Oil and Gas and Infrastruc-ture, Gaffney, Cline & Associates

17:15–17:35 adding liquefaction capability to an existing lng regasification terminal

■ Darron Granger, Senior Vice President Engineering and Construction, Cheniere Energy, Inc.

17:40–18:00 the supply chain optimisation of lng production Facilities—a rigorous approach solution

■ Chris Mole, Global Hydrocarbons Select Director, Worley Parsons

■ Nicola Knight, Principal Consultant, KBC Process Technology Ltd

18:00 - 20:00 event party—excel exhibition Hall

tecHnical tracks

Morninggas shipping and storage

09:00–09:10 chairman’s welcome■ Captain Andrew Clifton,

General Manager Designate, SIGTTO

09:10–09:40 new lng containment systems to overcome partial Filling and sloshing issues

■ Geoff Green, Managing Director, Wavespec

09:40–10:10 lng along nsr■ Frederic Hannon, LNG Shipping

Project Manager, Total

10:10–10:40 new generation of Modern lng carriers with type c cargo tanks and lng propulsion system

■ Bjoern Munko, Sales Manager, TGE Marine Gas Engineering

10:40–11:10 Break

11:10–11:40 recent developments within lpg cargo Handling systems

■ Stein Thoresen, LPG Business Unit Director, Hamworthy Oil & Gas Systems

11:40–12:10 cargo reliquefaction plant enhancements■ Andrew Scott, Weir LGE Process

12:10–12:40 From disaster to recovery: the impacts on the sendai lng terminal of the 2011 tsunami

■ Jun Imaiida, Production Engineering Section, Gas Technology Dept., The Japan Gas Association

reserve paper: the ships superintendent training course: Meeting the needs of the gas shipping industry

■ Steve George, Founder and Director, ECMS

12:40–14:10 delegate lunch

aFternoonFloating lng

14:10–14:20 chairman’s welcome■ Bill Sember, Vice President, ABS

14:20–14:50 Flng—Beyond prelude■ Neil Gilmour, General Manager FLNG,

Shell Upstream International

14:50–15:20 the commercialisation roadmap for Flng—appraising residual technology challenges, and integrating risk Mitigation strategies in development planning

■ Joe Verghese, Director, Select, Worley Parsons

15:20–15:50 lessons learned from a decade of Hydrodynamic and nautical studies for offshore lng operations

■ Johan Dekker, Project Manager, Maritime Research Institute Netherlands (MARIN)

15:50–16:20 Break

16:20–16:50 lng Barge developments Move Forward■ Javid Talib, Vice President, Black & Veatch

16:50–17:20 an overview of the challenges of lng Fire and explosion Modelling and risk assessment

■ Bibek Das, Senior Risk Engineer, ABS

17:20–17:50 operational Measures to reduce risk of damage due to sloshing

■ A.J. Macdonald, Principal Specialist LNG Containment Systems, Lloyd’s Register

reserve paper: the role of risk-Based Methodology to validate Floating lng projects and technology

■ Diane Ruf, Head of Veristar Machinery Dept., Bureau Veritas


conFerence and exHiBition opening tiMes Conference ExhibitionMonday 8 October 09:00–18:00 12:00–17:00Tuesday 9 October 09:00–18:00 10:00–17:00Wednesday 10 October 09:00–18:00 10:00–17:00Thursday 11 October 09:00–13:00 10:00–16:00

tHe eFet trading day

Morninggas Markets, prices and risk

09:30–09:35 chairman’s opening remarks■ Dr Colin Lyle, Board Member and Gas

Committee Member Chairman, European Federation of Energy Traders (EFET)

09:35–10:00 global perspectives of gas supply, demand and prices

■ Anne-Sophie Corbeau, Senior Gas Analyst, International Energy Agency

10:00–10:25 gas trading in europe—the big picture■ Andy Williamson, Head of Supply,

LNG, Logistics and Trading, EconGas

10:25–10:50 gas trading in north america— the big picture

■ Porter Bennett, President and CEO, Ponderosa Advisers

10:50–11:00 Future gas trading developments opportunities and risks

■ Q&A with panel

11:00–11:30 Break

11:30–11:35 chairman’s comments■ Dr Colin Lyle, Board Member and Gas

Committee Member Chairman, European Federation of Energy Traders (EFET)

11:35–11:50 liquidity in the nw europe gas market■ Bert den Ouden, CEO, APX ENDEX

11:50–12:05 expanding the central european gas Hub■ Gottfried Steiner, Chief Executive Officer,

Central European Gas Hub

12:05–12:20 How is lng influencing european gas trading?

■ Ian Wood, Director of LNG and Interna-tional Business Development, Centrica

12:20–12:30 outlook for pipeline gas and lng trading in europe; influences and interactions12:30–14:00 delegate lunch

aFternoonimproving trade in europe14:00–14:05 chairman’s opening remarks

■ Dr Colin Lyle, Board Member and Gas Committee Member Chairman, European Federation of Energy Traders (EFET)

14:05–14:35 keynote: the eu gas market, what will it be and what still needs to be done?

■ Walter Boltz, Vice-Chairman, Board of Regulators, Agency for Cooperation of Energy Regulators (ACER)

14:35–15:15 special panel response: the eu gas market—what will it be and what still needs to be done?

■ Gunnar Steck Regulatory Manager, E.ON Energy Trading

■ Sue Harrison, Head of International Policy, DECC, UK


■ Juan Rios, Global Head of Trading, Iberdrola

15:15–15:45 Break15:45–15:50 chairman’s comments


15:50–16:10 lessons from reMit implementation (regulation for energy Market integrity and transparency )

■ Mark Dalton, Operations Performance Manager, BG Group

16:10–16:30 reducing costs and improving reliability of information exchange

■ Hugh Brunswick, Managing Director, EFET.net

16:30–16:50 gas market supervision—what next?■ Dr. Karl-Peter Horstmann, Head of

Regulatory Compliance and Chairman, EFET Task Force on Market Supervision

16:50–17:10 concluding panel discussion17:10–17:15 closing remarks



to see the schedule for cotes, please see page 18

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Tuesday, 9 October 2012 5Gastech Conference & Exhibition Newspaper

Monday morning dawned cool and partly cloudy, with intermittent showers greeting Gastech delegates as they filtered into the ExCel Center. But while general delegates filed into the conference and exhibition throughout the morning, the VIP program was already in full swing.

The schedule for VIPs began with a breakfast and registration at 7:30. Execu-tives from some of the top natural gas com-panies in the world gathered to rekindle old friendships, develop new business contacts and assess the current state of the industry.

“This is the first time we’ve done a full VIP program of this magnitude,” said Jona-than Ellenor, director of government and external relationships for Gastech. “We are very excited, as this is the ultimate, exclu-

sive networking event. We’ve got the top 150 people in the natural gas industry, and we are providing exclusive breakfasts and roundtable discussions for them.”

The assembled VIPs came together on the second floor of the ExCel Centre, in the dedicated area for conference proceedings. There, they received their delegate packets and were treated to a buffet-style breakfast. The breakfast spread included a wide array of juices, fruit, pastries and bagels.

Gavin Sutcliffe, Gastech’s head of con-tent and programming, was present at the breakfast, mingling with the VIPs and answering any questions that they may have had about the gathering.

We are dedicated to building a legacy,” said Sutcliffe. “It is time to reach out to

the national oil companies (NOCs), and we see the VIP program as a way to reach out into the heart of the international natu-ral gas community.”

It is safe to say that Sutcliffe’s goal of reaching out to the NOCs is already start-ing to register, judging by the roster of del-egates attending Gastech.

“It’s about building relationships at the elite level,” Sutcliffe said. “We want to take these relationships, and then build up our contacts with the engineering firms

and construction contractors.”One of the VIPs at Monday morning’s

breakfast was Bill Dudley, president and CEO of Bechtel Group, Inc. Dudley has been with Bechtel since 1981, rising up through the ranks of the company to his current position in April 2008. Bechtel is an engineering, construction and project management company. Its diverse port-folio encompasses energy, transportation, communications, mining, oil and gas and government services. ■

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Published by Hydrocarbon Processing as four daily editions, 8–11 October. If you wish to advertise in this newspaper, or to submit a press release, please contact the editor via email at [email protected].

Gastech

2 Greenway Plaza, Suite 1020 Houston, TX 77252-77046713-529-4301gavin sutcliFFe, Gastech’s head of content and programming, welcomes Bechtel Group

President and CEO Bill dudley to the VIP breakfast.

VIP programme commences with a breakfastBilly ThinneS

The long-term fate of Japan’s LNG market will largely depend on whether the nation can secure deals to import LNG from North America, an executive with Tokyo Gas said. Shigeru Muraki, CEO of the Energy Solution Division of Toyko Gas, believes LNG prices will determine the balance between gas and coal usage in industries, such as power.

The International Energy Agency (IEA) forecasts that by 2020, gas prices will be $5.40/MMBtu in the U.S., $10.5/MMBtu in Europe and $12.4/MMBtu in Japan. However, if shale gas in North America is exported to Asia, the price is expected to drop to between $9 and $11, Muraki said. “If those pricing levels are achieved, LNG [import] demand in 2020 will increase to 90-to-100 million tonnes per annum (mtpa). If current pricing levels continue, the demand will continue at 70-to-80 mil-

lion. In Asia, it comes down to the pric-ing.” Muraki spoke at Monday morning’s Executive Leadership Panel session on whether the gas industry has entered a “golden age.”

Tokyo Gas, already one of the world’s largest LNG buyers, has significantly increased its deals following the 2011 earthquake disaster. In 2010, the year before the earthquake, Japan imported 70 mtpa of LNG. However, the import quan-tity increased after the earthquake, due to the shutdown of nuclear power plants, Muraki said, reaching 80 mtpa in 2011 and from 85-to-87 mpta in 2012.

Aside from North American exports, Muraki believes the other issue that will dictate Japan’s LNG market going forward is government policies on nuclear energy. “A government committee has announced a plan to decrease dependence on nuclear

energy to zero by the 2030s,” he said. “However, this plan has not been adopted as policy. Discussions are still ongoing and not finalized.”

Regardless of the exact policy details, nuclear capacity will be gradually decreased, he says, allowing gas to take a key role. Thus, to expand the gas market and promote its efficient use, measures will have to be implemented in Japan, such as the expansion of pipeline infrastructure.

At the same time, however, coal-based power stations are also being discussed as a method of lowering power generation costs. “Based on those circumstances, the future of energy demand can vary, based on the competitiveness of natural gas against coal in power generation,” Muraki said.

Either way, natural gas holds “large potential” to increase its competitive share in Asia and Japan in coming years, Muraki

concluded. “Its benefits will be mutually shared by both producers and buyers.” ■

Japan looks to secure North American LNG exportsBen duBose

sHigeru Muraki, Representative Director, Tokyo Gas


This year’s Gastech provides a vital opportunity for the many strands of the gas industry to share knowledge, at a time when it faces both rapid expansion and tough busi-ness conditions, delegates were told at the opening session of this year’s conference.

A warning issued last week by UK energy regulator, Ofgem, that the coun-try could face power shortages by 2015, showed the important role that gas is likely to play in meeting growing global power demand, said Chris Clucas, Commercial Director of Bernhard Schulte Shipmanage-ment Ltd, and Co-Chairman of Gastech, in welcoming remarks to the conference.

That view was supported by Gavin Sut-cliffe, Head of Content and Programming, Gastech, who said, “As national govern-ments strive to fulfil carbon emission obli-gations, often through costly renewable policies, natural gas surely answers many

of the environmental and cost-associated questions effectively, whilst immediately delivering energy flexibility as, and when, it is required by the end user.”

The LNG sector, in particular, faces an interesting future. “We live, at the moment, in very dynamic times, especially in the LNG industry,” said Paul Sullivan, Director of Global LNG and FLNG at Worley Par-sons, and also Gastech Co-Chairman. The industry is benefitting from up to $100 bil-lion of investment in new plant and equip-ment at the present, while around 70-90 new vessels are being built.

Clucas also highlighted the giant strides made by the industry, noting that when the first Gastech conference was held in the early 1970s, the entire global LNG industry was served by just 11 ships, compared to 350 carriers today. Meanwhile, the LPG fleet has grown from 300 vessels to more than 1,000.

Sullivan said that while the LNG indus-try was poised to double in size within the next 10 years, that growth would need to be made against a background of severe restrictions and shortages, in terms of fab-rication, contractor services, manpower and funding. “We have to admit, we are seriously resource-constrained across the industry,” he said.

The need to overcome such constraints through greater cooperation highlighted the importance of the opportunities provided by Gastech to exchange information and develop joint strategies.

“We need opportunities like this to be open-minded, to have the opportunity to recognize the issues that others are having to face within the industry, and perhaps to come up with alternative ways to fill that gap and find a way to cover those short-ages,” Sullivan said. ■

An opportunity to tackle challenges togetherian lewiS

paul sullivan, Co-chairman, Gastech, and Director of Global LNG/FLNG, Worley Parsons

European gas suppliers and policymak-ers will have to decide in coming years, whether they want to challenge Asia for the stability of long-term LNG contracts, an executive with BG Group said.

“The real issue at hand is how content governments and energy suppliers will be to leave customers open to market fluctuations,” said Chris Finlayson, executive director and managing director for BG Advance.

“Right now, we’re at the end of LNG supply trading, where long-term contracted volumes go to Asia. Are we prepared to take what the market will give, or are we going to push for more long-term con-tracts, no matter what the pricing may be?” Finlayson spoke on Monday afternoon’s regional executive leadership panel.

From now until 2025, the European share of gas demand not covered by long-

term contracts will slowly continue to grow, he said. “It’ll come slowly at first, then more rapidly over time,” he said. “More of the market will become open, leading to reliance on the spot market.”

In that case, both buyers and consumers become far more exposed to that market and what happens outside Europe. “We have the infrastructure in place,” said Fin-layson. “Contracting will become the key issue as we move forward.”

The global wholesale gas market will become more competitive, he said, but it may be hampered by an increasing reli-ance on a very small number of external suppliers. “We already have a high degree of concentration,” said Finlayson. “The best way to diversify supply is through uncontracted LNG. There has been reluc-tance, particularly in the UK, to put long-

term LNG supply contracts in place.”Asian suppliers are increasingly going to

the long-term model, panelists noted, espe-

cially with increasing volumes from North America. European suppliers will soon have to decide if they wish to follow suit. ■

Europe mulls LNG long-term vs. spot pricing models

A global industrial services company based in Rotterdam, Hertel joined the Gastech exhibition for the fourth time this year. One of the company’s recent announcements con-cerns last May’s opening of its new fabrication facility in Perth, Australia, for Chevron’s Gorgon LNG project on Barrow Island offshore Western Australia.

Allan Hollington, Hertel’s director of competence, commented on the Perth facility, “It’s a workshop that conforms to the quarantine [specifications]. Since Barrow Island is a Class-A nature reserve, everything has to be perfect. At Perth, we cut all the PIR insulation, and we’ll do sheet metal work, packaging and all that. Then, we make sure the quarantine [procedures] are all correct, and we’ll send it all off to be installed.”

When asked what Hertel plans to showcase at Gastech, Hollington answered, “Our expertise, specifically in LNG parts. Myself and my colleagues have all worked on major LNG plants around the world,” including several plants in the UK and Australia, along with facilities in Norway, Egypt, Brunei, Qatar and Trinidad.

“The Wheatstone LNG [project] is coming up very soon [in Australia], as well as Ich-thys, which will be up near Darwin. And we’re currently looking at the shale gas plants over on the East Coast [of Australia],” Hollington added.

“We have expertise in insulation for LNG,” said Hollington. “We like to be at the forefront of innovation.” ■

Hertel brings equipment and services to LNG projects worldwideaDrienne Blume

The team from Hertel made a strong showing on Monday.

The afternoon European Supply panel featured (left to right) proF. jonatHan stern, Oxford Institute for Energy Studies, moderator; steFan judiscH, CEO, RWE; cHris Finlayson, Executive Director, BG Group; jean-claude depail, President, Gas Infrastructure Europe; and alexander novak, Minister of Energy, Russian Federation.


Shale gas, LNG gain prominence in the global energy mixGas processing and liquefaction capacity expansions are forecast for all major LNG-importing and LNG-exporting regions

Adrienne Blume, Hydrocarbon Processing

The boom in shale gas production has coincided with an expansion of global liquefied natural gas (LNG) trade. Countries with large natural gas reserves are working to develop their resources for profitable export to consum-ing nations via pipelines, liquid petroleum gas (LPG) transport, LNG cryogenic tankers and gas-to-liquids (GTL) projects.

Due in part to the rise of unconventional gas resources, worldwide gas trade is anticipated to more than double over the next 25 years, with new trade routes and supply patterns emerging. Presently, LNG makes up 32.3% of gas shipments worldwide. Fig. 1 shows the division of the global LNG export market in 2011.

Supply driven by North America. The U.S. remained the world’s largest gas producer in 2011, with output rising 7.7% from 2010. The country maintained its focus on unconventional gas production, despite lack-luster North American natural gas prices. Russia fol-lowed close behind with a 3.1% increase on the year. Conversely, the EU’s gas output plummeted 11.4% on weak regional demand, and field maturation and main-tenance, marking the largest annual decline on record. The biggest contributors to growth in global natural gas supply through 2030 are expected to be the Middle East and the former Soviet Union. Incremental supplies will come from the U.S, Australia and China.

Demand picks up in Asia. Among fossil fuels, natu-ral gas is expected to see the fastest growth through 2030, while oil will see the slowest increase. Gas is anticipated to meet 31% of the projected growth in global energy consumption by that year. Also, global gas growth from 2010–2030 will be highest in the power and industry sec-tors, which is consistent with historical growth trends. Non-OECD regions will collectively account for 80% of global growth in demand for natural gas, with an average increase of 2.9%/yr through 2030.

In 2011, total global gas demand expanded just 2.2% vs. the 7.4% growth seen in 2010. Demand growth was below average in all regions except North America, where weak gas prices supported consumption. Outside of North Amer-ica, the highest demand growth levels were recorded in China (21.5%), Saudi Arabia (13.2%) and Japan (11.6%). Conversely, the EU recorded its largest-ever decline in gas consumption during 2011. The 9.9% decrease was spurred by economic turmoil, mild winter weather, high gas prices, and increased generation of renewable electricity. By vol-ume, the U.S., Russia and Canada remained the world’s three biggest users of natural gas.

Infrastructure development is key. Gas process-ing and liquefaction capacity expansions are forecast for all major LNG-importing and LNG-exporting regions, which will also require the addition of LNG carriers to

transport the fuel. Investments reflect ongoing efforts to retrofit existing plants to meet growing demand for energy and natural gas products, to improve processing flexibility, and to comply with environmental and safety regulations.

Hydrocarbon Processing’s Market Data 2013 contains further analysis of the LNG and gas processing markets, including construction projects and spending forecasts, unconventional gas developments, and regional trends in gas production and use. The entire report also covers refining, pet-rochemicals, safety and environment, and economic trends. For more information, please visit www.gulfpub.com. ■

ADrIENNE BLumE is the process editor for Hydrocarbon Processing. One of her main responsibilities for the magazine is coverage of the natural gas industry.

Algeria5%

Nigeria8%

Australia8%

*Trinidad and Tobago, Russia, Oman, Yemen, Egypt, Brunei, Equatorial Guinea, Peru, Abu Dhabi, Norway and U.S. (Alaska)

Indonesia9% Malaysia

10%

Qatar32%

Other*28%

FiG. 1. Division of global LNG export market, 2011.

New butterfly shut-off valves handle liquefied gas transport

As a complement to its extensive range of butterfly valves for handling liquefied gas, KSB Ltd is presenting the new TRI-ODIS valve series at this year’s GasTech Exhibition. These maintenance-free, tri-ple-offset butterfly valves are designed for handling fluids with temperatures ranging from –250° to +200° Celsius, depending on their properties, and operating pressures of up to 100 bar.

Thanks to these valves’ design, the clos-ing torque is lower than that of double-offset disc valve types, which makes them suitable for use with smaller actuators. With their triple-offset design and tapered sealing surfaces, these valves ensure tight closure, even at very high differential pressures. Sealing can be effected by means of HELI-COFLEX seat rings, which are known for their excellent performance in cryogenic applications worldwide. The valves provide bi-directional shut-off.

These butterfly valves do not require a travel stop for the closed position, because their metal seats form natural stops. This protects the valve seats, should the actuators operate the valves in the wrong direction. The valve stem is a single-piece design supported by generously-dimensioned plain bearings. Tight shut-off is ensured, even after numer-ous actuating cycles. An additional anti-blowout device prevents the stem from being blown out of the body in the event of a failure.

TRIODIS butterfly valves are available with diameters ranging from 200 to 1,200 mm. The stainless steel bodies can be sup-plied, either with flanges or with butt weld ends. The series includes a special butt-weld side-entry version. The butt weld end serves to weld the valve into the piping. For main-tenance, the valve trim can be pulled out of the body without having to remove the entire valve. This is a major advantage, especially when space is limited.

This new valve series will continue to provide tight shut-off, even in the event of a fire. It has successfully passed the Fire Safe Tests for API and BS (British Stan-dard). These tests were performed at the research center in Gradignan, France, on a KSB test stand, which was built specially for this purpose. The actuator flanges and stem ends will accommodate manual, pneu-matic, hydraulic and electric actuators of any make. Over 50% of all gas tankers worldwide, as well as many loading and processing terminals, are equipped with KSB’s AMRI valves.

Butterfly valves. As North Sea gas reserves have begun to deplete, the UK has moved from self-sufficiency in gas sup-plies to a growing dependency on imported gas. At present, the country imports half its needs, and that figure is likely to increase further, to 75% by 2020.

The Isle of Grain LNG Terminal is situ-ated on the Isle of Grain, on the River Med-way in Kent. It is one of four strategically located LNG terminals being developed in the UK. In recent years it has seen a major expansion of its importation and storage facilities with the construction of the larg-est above-ground, full-containment, LNG storage tanks in the world.

KSB has played a part in this expansion with the supply of its Amri cryogenic but-terfly valves to handle LNG at –161° C. The DANAIS TBT series is produced at its manufacturing center for butterfly valves and actuators, based in La Roche–Chalais, near Bordeaux in France.

After the Fukushima disaster in Japan, and the nuclear phase out in Germany, the demand for LNG and, hence, the means to transport it, has increased sharply. Many of the liquefied gas tankers visiting UK shores will have valves supplied by KSB. ■


News in briefBP gets OK for deepwater gas exploration in South China Sea

BP has obtained approval from the Min-istry of Commerce to explore in the South China Sea, in what will be the company’s second deepwater project in China.

BP will have a roughly 40 percent stake in the block during the exploration period, and a 20 percent share when the project has moved into production.

BP’s participation in block 43/11 will diminish the size of a share held in the proj-ect by Anadarko Petroleum Corp, a U.S. energy company, which previously had a 50 percent stake in the block under a con-tract with CNOOC. The planned explora-tion will mark BP’s second deepwater proj-ect in China. In September 2010, it bought a 41 percent stake in another block in the South China Sea.

BP said such deepwater work is among the four areas of opportunity that the com-pany wants to exploit in conjunction with its Chinese counterparts in China and over-seas markets. The other three pertain to natural gas—both conventional and uncon-ventional types—integrated refining and chemicals and high-end lubricants.

BP also said it plans to spend about $630 million on the third phase of a proj-ect to make purified terephthalic acid–which is used in many plastics–at its BP Zhuhai Chemical Company Ltd plant in Guangdong.

no gas at exxonmobil’s PnG exploration well

Plans for a possible expansion of Exxon-Mobil’s LNG project in Papua New Guinea suffered a slight setback, after an explora-tion well failed to discover any natural gas.

The Trapia-1 well did not intersect any prospective reservoir intervals before reaching its total depth of 3,800 m, the U.S. company’s joint venture partner, Oil Search, said in a statement.

Hopes that the partners will find enough natural gas to expand the project to three LNG production units from the two cur-rently under construction were recently buoyed by a large gas discovery at the P’nyang prospect. The venture is also exploring for more gas at the Hides pros-pect, and analysts remain optimistic that a third production unit, or train, will eventu-ally be constructed.

Chevron announces natural gas discovery offshore Australia

Chevron Corp. announced further drill-ing success by its Australian subsidiary in the Greater Gorgon Area, in the Carnar-von basin, a premier hydrocarbon basin.

The Satyr-2 discovery well confirmed approximately 128 ft of net gas pay. The well is in the WA-374-P permit area, approximately 75 mi northwest of Barrow Island, off the Western Australian coast. The well was drilled in 3,570 ft of water to a total depth of 12,454 ft. Satyr-2 is Chev-ron’s fifteenth discovery in Australia since mid-2009.

George Kirkland, vice chairman, Chev-ron Corporation, said, “This new discov-ery in the Greater Gorgon Area further highlights the quality of Chevron’s explo-

ration capability in the region and the sig-nificance of Australia to Chevron’s energy portfolio.”

Melody Meyer, president, Chevron Asia Pacific Exploration and Production Company, said, “The continued explora-tion success in the Carnarvon basin could help underpin expansion opportunities at our LNG projects in Australia and support our drive to become a leading supplier of liquefied natural gas to world markets, and domestic gas to Western Australia.”

Chevron Australia is the operator of WA-374-P, with a 50 percent interest, while Shell and Exxon Mobil each hold 25 percent.

eni reports significant gas discovery in Pakistan

Eni has made a significant gas discovery onshore Pakistan, in the Badhra Area B exploration concession, in the Khirtar Fold Belt region, 350 km north of Karachi.

The Badhra B North-1 exploratory well, which led to the discovery, was drilled at a total depth of 2,450 m and encountered over 54 m of net gas pay in two thick Cre-taceous sandstones of the Mughal Kot for-mation. During the production test, the well flowed high-quality gas from the two res-ervoirs, respectively, at 25 and 35 MMcfd.

The size of the discovery is estimated at between 300 and 400 Bcf of gas-in-place, and its delineation will require further appraisal wells.

The discovery is 20 km east of the Bhit gas processing facility, operated by Eni, which handles gas production from Bhit and Badhra fields. The drilling of Badhra North B-1 is part of Eni’s new strategy in Pakistan, which aims to refocus explora-tion activities in the neighboring areas to productive fields and confirms the presence of significant exploration potential that can be exploited through the application of new geological models.

Eni has started discussion with the Pak-istani regulator and the joint venture, in order to speed up production of the discov-ery through a long-term production test that will allow for commercialization of gas, and help to reduce the national gas deficit. The short time-to-market for development of the field is part of Eni’s strategy to focus on rapid development of conventional and synergistic assets.

Eni, through its subsidiary, Eni Paki-stan Limited, is operator of the block with a 40% stake in the development phase, together with partners Premier Oil (6%), Kufpec Pakistan (34%) and Oil & Gas Development Company (20%).

Eni has been present in Pakistan since 2000 and is the largest producer in the country, with an average equity produc-tion of approximately 54,800 boed in 2011.

lundin makes third gas discovery offshore malaysia

Lundin Petroleum announced that it has completed the Berangan-1 well in SB303 Block, offshore Sabah, Malaysia, as a gas discovery.

Berangan-1 is a vertical well drilled to a depth of 1,709 m in approximately 70 m of water. The well penetrated a gross gas column of over 165 m in the targeted

mid-Miocene-aged sands, 10 km to the southeast of the Tarap gas discovery made by Lundin in 2011, and 15 km to the south of the Cempulut gas discovery, also made in 2011. An extensive data acquisition program was completed, including fluid samples and a pressure profile, indicating a single continuous gas column is present, and defining the probable gas-water con-tact. Further work will follow to estimate recoverable resource ranges.

Ashley Heppenstall, President and CEO of Lundin Petroleum comments, “Beran-gan is the third gas discovery made by Lundin Petroleum in SB303 and the fourth in the contract area which also includes the Titik Terang discovery. The four gas fields lie within a 10-km radius and present a clear opportunity to evaluate the potential for a gas cluster development.”

Following Berangan-1 the West Cou-rageous rig will move to offshore Pen-insular Malaysia to execute a three-well exploration campaign, commencing with the Merawan Batu-1 well in the PM308B Block.

Lundin Petroleum holds a 75 percent interest in SB303 through its subsidiary Lundin Malaysia BV. Lundin Malaysia BV’s partner is PETRONAS Carigali Sdn Bhd with 25 percent. Lundin Malaysia BV operates six blocks in Malaysia, namely PM307, PM308A, PM308B, SB303, SB307 & SB308.

lebanon fights to join east mediterranean gas boom

Lebanon’s dysfunctional, crisis-ridden government is reported to be close to appointing a panel to oversee exploration of potential rich natural gas fields offshore, that could be the salvation of a country hovering on the brink of a new sectarian explosion.

But no one’s holding their breath that foreign companies are likely to start drill-ing any time soon, even as neighboring Israel and Cyprus, which sit on the same gas-bearing strata as Lebanon, move swiftly toward energy self-sufficiency and lucrative export programs.

The signs, based on 3-D seismic sur-veys, are that Lebanon probably has major gas fields within its maritime eco-nomic zone.

“The data that I have is that there’s greater potential offshore Lebanon than offshore Syria and offshore Cyprus,” David Rowlands, chief executive officer of Nor-way’s Spectrum Co., which is surveying the Lebanese sector.

Israel, whose exploration operations are the most advanced in the region, has found around 30 trillion cubic feet (Tcf) of gas in its waters since 2009, and that’s expected to rise.

Cyprus found some 7 Tcf in one of 12 blocks of Aphrodite field off its south coast in its first exploratory drilling in December 2011. The Cypriots say they sit on enough gas to meet their current consumption rate for 200 years.

Syria lies along the same offshore strata. It hasn’t conducted surveys yet. However, it’s understood to contain gas fields similar to its neighbors.

The U.S. Geological Survey reported in 2010 that the Levant basin, which runs from Syria through the waters of Lebanon, Israel, Cyprus, the Gaza Strip and Egypt, contains 122 trillion cubic feet of gas and some 1.7 billion bbl of oil.

Spectrum and its partner, Dolphin Geo-physical, are surveying some 1,200 square miles of the eastern Mediterranean, a pro-gram due to be completed in January.

But the Lebanese, their political process tangled in traditional sectarian rivalries between Muslims and Christians, and even sub-groups within those camps, are trailing badly in the race for undersea riches.

Each sect wants its slice of the potential revenue and, given the deep-rooted corrup-tion in Lebanon’s political and economic life, some observers question how much of the eventual gas revenues will reach gov-ernment coffers.

This, and the flare-up in sectarian ten-sions fanned by the 18-month-old civil war in neighboring Syria, has bedeviled Leba-nese efforts to create an energy infrastruc-ture and governing body to issue explora-tion licenses and negotiate contracts with foreign oil companies.

A recent seminar on gas exploration was attended by dozens of companies. Many were just testing the water, but a surpris-ing number were serious about drilling off Lebanon—although it remains to be seen how many will risk doing so.

With Lebanon’s economy dipping dan-gerously, as much from a lack of economic strategy and a functioning government as from the perpetual political instability, the energy-starved country needs to utilize its gas reserves quickly.

Lebanon, like its old enemy, Israel, desperately needs cheap energy. Lebanon has to import 96 percent of its energy con-sumption on oil imports.

That’s bad enough in the best of times but impossible when prices soar, as they are now, because of regional tensions.

Right now, Lebanon’s state electricity system is falling apart, with major black-outs daily.

On top of that, the squabbling Lebanese were late in providing the United Nations with Beirut’s claims over maritime waters with Israel, with which Lebanon is still technically at war.

The Iranian-backed Hezbollah, a Shi-ite political movement that also has the most powerful forces in Lebanon, fought a 34-day war with Israel in 2006 and is braced for a new one.

It has vowed it won’t allow Israel to “plunder” its energy assets. Hezbollah leader Hassan Nasrallah warned in 2011, “Whoever harms our future oil facilities will face the same damage.”

Beirut claims Israel’s largest field, Levi-athan, with reserves estimated at 16-tcf, encroaches on some 330 square miles of Lebanon’s maritime zone. Israel denies that, and the countries are locked in an escalating dispute over gas fields and oil worth billions of dollars that could be both countries’ economic salvation. Israel is equally adamant. Last year, Infrastructure Minister Uzi Landau declared, “We will not hesitate to use our force and strength.” ■


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CD2701_LR_Gastech_half_page_15"x5.2"_CTE.indd 1 27/09/2012 13:21

Technical track spotlightTuesday, 09:00: Gas Shipping and Storage

The traditional start to Gastech’s techni-cal programme, often called the “SIGTTO Session,” is once again chaired by the soon-to-be general manager of the Soci-ety of International Gas Tanker & Terminal Operators (SIGTTO), Captain Andrew Clif-ton, who will take the helm of the Society when Bill Wayne steps down in November. Mr. Clifton is no stranger to the gas ship-ping business: he rose from Cadet to Master aboard gas carriers before taking a Nautical Studies degree (with 1st Class Honours) and working ashore with the UK Marine Acci-dent Investigation Branch (MAIB) before joining Golar and BP Shipping to work in their LNG shipping operations. During this period, Mr. Clifton was seconded to SIGT-TO’s Secretariat, so he knows the business well from the inside. Most recently, before he took the Society’s top job, Mr. Clifton was in charge of shipping at BP’s Tangguh LNG project, and brought it into operation.

Under Mr. Clifton’s guidance, we will hear about many new technical develop-ments in the industry. Geoff Green will start by introducing the new LNG contain-ment system developed by Braemar. The new design has been developed to over-come the problems associated with par-tial filling and sloshing, which can pose major operational constraints with exist-ing systems. This is the first major public presentation of this new containment sys-tem, which is also the first new design to be announced for some years—and promises to be a great opening to the morning.

Much of the world’s energy resources are in difficult locations with extreme cold climates. One of the most likely schemes to bring gas to market in the near future is the Yamal project, which will make use of the increasingly fractured ice flows in the Arctic region, along the so-called North Shipping Route (NSR). Frederic Hannon of Total will explain progress to date.

The increased interest recently in niche markets for limited quantities of LNG has lead to the development of small LNG car-riers with IGC Code “Type C” cargo tanks (i.e. pressure vessels) and LNG-fired pro-pulsion systems. TGE Marine has designed and delivered a number of ships to this design, and their sales manager, Bjorn Munko, will explain how this new genera-tion of LNGC’s can be designed.

The upsurge in the LNG market has also seen a significant increase in the quantities of LPG being transported. For some years, the basic design of LPG carriers had hardly changed. But now, two of the leading cargo system designers (Hamworthy Oil & Gas and Weir LGE) have announced improved new designs for this type of ship. Stein Thorsen of Hamworthy will explain their new design that reduces the number of gas compressors (thereby reducing capital cost) while maintaining performance by using condensate to cool gas in free-flow mode. As an alternative, Andrew Scott of Weir LGE will explain his company’s patented “vent gas cooling” system, which promises to improve cooling capacity, especially with increasing ethane content. A lively debate is set to follow on these new design alter-natives , both of which have been incor-porated in new building contracts and are currently under construction.

The final paper scheduled for the morn-ing session is also likely to create a great deal of interest. In March 2011, the tsu-nami that hit Northern Japan damaged the Sendai LNG import terminal as well as the nuclear power plant at nearby Fukishima. Jun Imaiida of the Japan Gas Association will explain how the tidal wave affected the plant and how the terminal has been rebuilt.

The reserve paper for the session describes the ship superintendent course developed on the Isle of Man by ECMS and some of the leading local ship man-agement companies – including Bernhard Schulte Shipmanagement. Steve George, director of ECMS, developed the course after a lifetime in the shipping industry, working his way up from cadet to chief engineer on LNG carriers followed by a varied and successful career ashore in sur-veying and ship management. The purpose of the course is to address the growing need to improve professionalism in shore man-agement offices as the candidates from the traditional sources, ship’s engineers, are either not available or have insufficient skills due to accelerated promotion and lack of experience. The course has run suc-cessfully for a number of years.

The session will close with a surprise announcement—and everyone interested in the technical development of the LNG ship-ping industry should be there to hear more.

Tuesday, 14:10: Floating lnGGastech audiences have listened atten-

tively to many presentations on floating LNG (FLNG) in recent years, and now that there are at least three floating LNG pro-duction units on order, the interest will be more keenly felt than ever.

The chairman for this session is Bill Sember, vice president of the American Bureau of Shipping (ABS). Neil Gilmour of Shell Upstream will offer the first pre-sentation, describing the company’s Pre-lude project.

Each of the three projects under con-struction uses different liquefaction tech-nology, and it is likely that each new scheme will be tailored differently to suit local conditions. Joe Verghese will explain the technology challenges in developing these units and how to mitigate risks when planning development.

One particular aspect that sets FLNG apart from land-based plants is hull move-ment. Hydrodynamic and nautical studies have been made on floating units for many years, involving both computer simula-tions and physical tank testing. One of the leading facilities is the Marin Insti-tute in The Netherlands, and their project manager Johan Dekker will explain the lessons learned from these studies over the past decade.

Black & Veatch is one of the leading designers of barge-mounted units, and Javid Talib, Black & Veatch’s vice presi-dent of engineering will explain how the design of LNG barges is moving forward.

One major problem that faces all design-ers of barges or any other floating units is congestion on deck, which in turn gives rise to additional hazards like fires and explosions. BIbek Das, senior risk engineer at ABS will explain how these risks arise and how they can be assessed, modeled and mitigated. ■


Since 2011, the LNG sector has contin-ued to demonstrate its global appeal, and its ability to reconfigure and expand gas markets. Furthermore, it has demonstrated a capability to respond to dramatically changing market conditions and redirect cargoes to various destinations, something that cannot be done easily through gas pipeline systems. Consequently LNG’s influence is expanding in all gas-trading continents, albeit in ways not envisaged a few years ago.

In North America, LNG provides poten-tial opportunities for gas supplies trapped in an oversupplied market to enter profit-able markets through exports. In Asia, it has helped to plug energy shortfalls following the March 2011 Fukushima nuclear acci-dent in Japan and the large-scale outages of nuclear capacity. LNG has also competed effectively in Asia against oil products dur-ing sustained periods of high oil prices, providing LNG suppliers with high returns from oil-indexed cargoes. In Northwest Europe, expanded LNG volumes delivered to gas hubs have shaken up gas markets dominated for decades by long-term take-or-pay contracts, indexed mainly to petroleum products by the somewhat complacent pipe-line gas suppliers (i.e., Norway and Russia).

The sustained differential between long-term pipeline gas in Europe, and cheaper short-term gas traded at hubs, has persisted from 2009 to 2012. This is due partly to lower gas demand caused by an economic recession, and caused partly by more abun-dant LNG supplies from diverse sources. This has led to several European power utilities posting large losses in recent peri-ods, caused by the take-or-pay elements of their long-term pipeline gas contracts; being forced to buy gas at a high price and sell at a lower price is never going to be a profitable model. Gazprom, which had resisted calls by its customers to discount the prices of its oil-indexed contracts since 2009, finally announced that it had agreed to as much as a 10% reduction in gas prices with E.ON, the German power utility, in July 2011.

The rapid deployment of floating stor-age and regasification units (FSRUs) at strategic locations around the globe to bring in competitive energy supplies con-tinues to open up and expand emerging LNG markets, particularly in South Amer-ica and the Middle East, but also in parts of Europe and Asia. The increasing number of countries that intend to deploy FSRU vessels is testament to the appeal of limited infrastructure requirements to smaller or

seasonal gas importers, and to those wish-ing to benefit from LNG imports quickly.

Following decades of being proposed as a viable technology, floating liquefaction projects have finally been sanctioned in Australia and Malaysia. If these pioneer-ing projects prove to be efficient and cost-effective, several more are likely to follow over the next decade. All these positive developments progressively make the LNG industry more diversified and better posi-tioned to provide secure, sustainable sup-ply around the globe. This does not mean, however, that LNG is poised to displace pipeline gas as the main, most-efficient means of transporting large gas volumes from a gas-resource-rich region to a major market. However, in many cases, geopo-litical issues and long distances, including the crossing of transit countries, imposes higher transit tariffs and risks for major export gas pipelines than LNG options.

The presence of LNG storage and regasification terminals, and import gas pipelines, both feeding into a major gas market, tends to lead to a dimension of competitiveness and flexibility. This improves security and diversity of gas sup-ply, and acts to moderate gas prices in that market. This applies, even when most of the flexibility comes from 15% to 20% of the LNG trades being conducted on a short-term basis, rather than long-term contracts.

Having extolled LNG’s virtues, it is important to not get too carried away with these positive developments. The imbal-ances and disparities between the North American, European and Asian gas mar-kets result in a number of negative outcomes for gas players along the supply chain, e.g., Asian gas buyers locked in to oil-indexed prices, and some producers captured by long-term supply contracts into North Amer-ica (e.g., Egypt, Nigeria, Qatar, Trinidad & Tobago and Yemen). This situation means that LNG traders, aggregators and portfolio LNG players, as they are often referred to, continue to have plenty of opportunities to arbitrage short-term cargoes destined for North America and/or Europe, and divert them to high-paying Asian customers. This trade is very lucrative, and when cargoes are diverted from their contract destinations to higher-paying alternatives, the ultimate LNG supplier/producer often shares the benefits with its long-term customer.

However, what happens in some cases now is that cargoes land in North America, and then are re-loaded and exported to Asia or other higher-priced destinations. In such

cases, the ultimate producer of gas can be disadvantaged, if it does not share in the benefits of sale of the re-loaded cargo. The U.S. Energy Information Administration (EIA) statistics for LNG imported and re-exported from the U.S. suggest that several such re-exported cargoes have been traded over the past year or so. Such treatment of gas producers by some LNG aggregators and traders, even if contractually possible, is unlikely to foster long-term sustainable relationships between gas buyers and sup-pliers, and seems likely to fuel disputes between them in the future.

The remainder of this article highlights some of the key developments in the LNG sector since 2011 in Asia, the Middle Eat and South America. Europe and North America are covered in Part 2, which is scheduled to run in Day 4. The import and export statis-tics quoted in the article are reported by the BP Statistical Review of World Energy (June 2012 and earlier editions).

ASIAN DEmANDChina. The current capacity of the coun-

try’s five existing LNG receiving terminals is about 18 million tons per annum(mtpa). The capacity is expected to grow to 30 mtpa by 2015, as five more plants under construction are added along the country’s coastline. The Dapeng terminal in Guang-dong is in the process of being expanded from 6.7 mtpa to 13.5 mtpa, forming part of the ongoing expansion to 2015. CNOOC and Shenzen Energy were granted permis-sion in July 2012 to build a second LNG receiving terminal at Shenzen, Guangdong, with an initial capacity of 4 mtpa. In addi-tion to the five terminals under construc-tion (Zhejiang, Zhuhai, Hainan, Tangshan and Qingdao), each with an initial capac-ity in the range 2 to 3 mtpa with plans for subsequent expansion, several others are in planning at Yacheng, Jieyang and Guangxi.

Whereas China was able to secure LNG supply for its first two LNG terminals at favorable prices (i.e., minimal oil index-ation) nearly a decade ago, it is more of a challenge now. China’s state-owned companies have entered into a series of long-term oil-indexed contracts with LNG projects under construction in Australia and Papua New Guinea, and some short-term and medium-term diversion cargoes for ongoing LNG supply expansion. China estimates, in its latest five-year plan, that it will need up to 60 new LNG tankers by 2020 to service its LNG requirements and is planning to build most of them in China. Currently, it builds LNG carriers at the Hudong shipyard, but intends to develop

up to three other shipyards to achieve this goal. China’s imports of LNG increased by some 29% to 6.7mt in the first half of 2012, relative to the same period in 2011, at an average cost of about $11.30 / MMBtu, according to the Beijing-based General Administration of Customs data.

India has emerged as a major Asian LNG import market over recent years and is set to continue its growth with the build-ing of new receiving terminals. In 2011, India imported 12.7 mt, making it the third largest LNG importer in Asia, behind Japan and Korea. Most of the LNG arrived from Qatar (76%), with additional cargoes com-ing from Algeria, Australia, Egypt, Malay-sia, Nigeria, Norway, Oman, Trinidad, U.A.E., the U.S. and Yemen.

Petronet LNG set up the country’s first LNG receiving and regasification termi-nal at Dahej, Gujarat, in 2004, and is in the process of building another terminal at Kochi, Kerala. While the Dahej termi-nal has a nominal capacity of 10 mtpa, the Kochi terminal will have a capacity of 5 mtpa. While Dahej is importing LNG from Qatar, Kochi plans to import LNG from Australia’s Gorgon field.

Construction of state-owned Gas Authority of India’s (GAIL) 5-mtpa receiving terminal in Dabol, Maharash-tra, is nearing completion and should be fully commissioned in 2012. GAIL began commissioning the long-delayed facility in second-quarter 2012. There are plans to expand pipeline capacity within India, which currently acts as a bottleneck limit-ing access of many customers to LNG. The government reduced GAIL’s pipeline tariffs in July 2012 in attempts to further promote gas from third parties reaching customers.

Several projects are in the planning phase to build new LNG receiving terminals on India’s eastern coast that, to date, lacks an LNG import facility. A 5-mt FLNG facil-ity by Shell and Reliance at Kakinada in Andhra Pradesh is awaiting a final invest-ment decision for a possible 2014 start-up.

Indonesia. The world’s largest LNG exporter not so long ago (a position now held by Qatar), Indonesia commissioned its first FSRU in April 2012. The Nusantara FSRU is stationed in Jakarta Bay, West Java, and is being supplied by Total with LNG from Indonesia’s LNG export termi-nal at Bontang, East Kalimantan, which is contracted to supply some 11.75 mt of LNG to the FSRU from 2011 to 2012. In addition to conventional gas, the Bontang export facility has also received coalbed methane production from the adjacent Sanga-Sanga field held by Vico Indonesia, a joint venture between BP and Eni.

Pertamina is mulling conversion of the aging Arun LNG export terminal in North Sumatra into an LNG receiving terminal to take gas from the Tangguh LNG export facility, operated by BP, in Indonesia’s Papua province. In June 2012, BP signed a gas supply agreement with Indonesia to supply LNG from the Tangguh export facility for use in domestic Indonesian

See lnG, page 12

LNG demonstrates market power and versatility, Part 1dAVid WOOd, DWA Energy Limited, Lincoln, uK

The Arctic Princess leaves Melkøya port near Hammerfest, northern Norway, with an LNG cargo from Snøhvit field for markets in Spain, the U.S. and Japan. Photo courtesy of Statoil.

India’s first LNG receiving terminal is located at Dahej, on the west coast.

With our comprehensive portfolio of gas solutions, spanning from onshore to offshore, LNG to FLNG, and pipeline to storage we’re ready to help you power the world. GE works by leading progress together.

Powering

©2012 General Electric Company Photo courtesy of Adriatic LNG


power supply. This is part of plans to add an additional liquefaction train to that export facility. Shell’s entry into the remote offshore Masela Bock to join Inpex brings a little closer the development of the Abadi natural gas field in Indonesia’s Arafura Sea using FLNG technology. The Indonesian government announced in June 2012 that it was expecting $20 billion to be invested in that project from 2013.

Like its neighbor, Malaysia, Indonesia is now embarking on a more complex LNG strategy that involves continued exports of large quantities of LNG under its long-term supply contracts to East Asian buy-ers alongside movements of LNG, includ-ing imports, to supply a network of LNG receiving terminals.

Japan continues, by far, to be the world’s largest LNG importer. The energy short-fall resulting from the shutdown of Japan’s nuclear power capacity from March 2011 through to mid-2012 further increased its demand for LNG (together with petroleum products and coal) for power generation. In 2011, Japan imported 79.2 mt of LNG, which was up from 69.2 mt in 2010, an increase of 14.5% on the year. In January 2012, Japan set a record for the most LNG that it had ever imported in a single month, i.e., 8.2 mt. Malaysia, Australia, Qatar, Indo-nesia, Russia and the U.A.E. were Japan’s major gas suppliers in 2011, in that order.

The outlook for LNG imports to Japan is uncertain in mid-2012, as a significant part of its nuclear power capacity comes back on-line. Japan’s economy has struggled for more than a decade, and the impact of the March 2011 tsunami has further dented its economy. Hence, at a time when many LNG suppliers are looking to place short-term cargoes into Asian markets, due to economic weakness and over-supply of gas in Europe and North America in 2012, growth in LNG demand is unlikely to come from Japan in the medium term. Nevertheless, Japan’s commitment to LNG is robust, and the fact that it is building new combined cycle gas turbines, shows that its LNG demand growth should return over the long term.

Malaysia has made key advances on LNG imports and exports in 2012. In June, it commissioned an LNG receiving terminal 3 km offshore Sungai Udang, Melaka, which consists of an island jetty re-gasification unit (JRU), two floating storage units (FSUs—converted LNG carriers) with a 3.8-mtpa throughput capacity and a 3-km subsea pipeline connecting to a new 30-km onshore pipeline that links into the existing Peninsu-lar Gas Utilisation (PGU) pipeline network. In June 2012, Petronas signed a flexible LNG supply contract with Statoil for the delivery of about 1 Bcm of gas over three-and-half years. In February, a new LNG receiving terminal project was announced for Lahad Datu in Sabah to feed a 300-MW power plant to be commissioned in 2015. A feasibility study for another regasification terminal at Johur is also underway.

Pakistan suffers an energy crisis, which includes a significant shortfall in the abil-ity of its domestic gas production to meet demand. Estimated gas supply in Pakistan is some 4.2 Bcfd with demand at 5.4 Bcfd, and the shortfall set to rise to 3.0 Bcfd by 2016. Negotiations have been underway for several years with Iran for an import pipe-line, and with Turkmenistan for the con-struction of the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline. Both

pipeline projects are expensive, and fraught with political and commercial risk. Paki-stan has awarded LNG import licences to three companies planning to sanction three separate FSRU facilities at Port Qasim, each with 0.5-Bcma capacity. In July 2012, Global Energy Infrastructure Pakistan stated that it would complete establishment of the first FLNG by October 2012; Energy Corporation EVTL expected to complete the second by December 2012; and Paki-stan Gas-Port expected to complete the third vessel by 2014. During early 2012, Pakistan began negotiations for 0.5 Bcfd of LNG supply with Qatar and Algeria, but as of July 2012 had failed to agree on a price with Qatar, as that country is seeking a full oil-price indexation pricing mechanism.

Singapore. The country’s LNG receiv-ing terminal is now 80% complete and on track for completion before the end of 2013. Singapore makes little secret of its desire to become a major LNG trading hub, once this terminal is operational. The pro-posed Trans-ASEAN (Association of South East Asian Nations) Gas Pipeline (TAGP), backed by Singapore, is an ambitious proj-ect aimed at linking gas supplies among Indonesia, Malaysia, Singapore, Vietnam, Myanmar, the Philippines, Brunei and Thai-land, with a target of being operational by 2020. A vital component of that scheme is the development of the massive CO2-rich East Natuna gas field offshore Indonesia, for which an Indonesia-Thailand gas pipe-line is to link supply from that field to the Thailand-Malaysia Joint Development Area (JDA), and on to Thailand’s existing pipe-line network at Erawan. LNG delivered at Singapore could ultimately be fed into TAGP and delivered onward by pipeline (or LNG) across Southeast Asia.

South Korea is the world’s second larg-est LNG importer, with Kogas being the single largest LNG buyer. It has posted significant growth in its demand over the past few years, importing 36.5 mt of LNG in 2011, experiencing 43% growth over five years, which is impressive, taking into account that this period includes the global recession of 2008-9. Qatar, Indonesia, Malaysia, Oman, Russia and Yemen were South Korea’s major gas suppliers in 2011, in that order. South Korea is slightly less diversified than Japan in the context of the number of countries from which it imports LNG; it also has greater seasonal swing in its LNG demand, requiring significantly more LNG during its cold winter months.

Taiwan continues to receive LNG at its two receiving terminals (Taichung and Yung-An), with about 75% delivered under long-term cargoes. In 2011, it received about 12 mt of LNG, including short-term deliver-ies from suppliers throughout the world.

Thailand commissioned its first LNG receiving terminal in 2011. PTT, the state-owned entity in Thailand, commissioned the $900 million 5-mtpa terminal, located at Map Ta Phut in Rayong province. Con-struction relating to a second 5-mtpa unit at the same location is expected to start soon. Thailand has imported LNG cargoes from a number of suppliers over the past year. Several of these cargoes were originally destined for North America, but subse-quently diverted to secure high prices.

mIDDLE EAST DEmANDIsrael. Gas supply from Egypt was one

of the casualties of the “Arab Spring.” A

gas pipeline built to supply Israel and Jor-dan from Egypt has been blown up some fifteen times since 2011, and Egypt froze supplies to Israel early in 2012, demanding a higher price for the gas it supplied. Sev-eral Mubarak-era Egyptian ministers and businessmen have been tried and impris-oned for selling the gas to Israel at what is claimed to be below-market rates. This situation has prompted Israel to increase the pace of its efforts to develop its recent large offshore gas finds and resort to LNG imports in the interim, using an FSRU being installed by Excelerate about 10 km off the coast at Hadera. The FRSU is expected to be operational by year-end 2012. BP is reported to be commencing delivery of two LNG cargoes per month to the Hadera FSRU from December 2012 for six months, to fill the gap until supplies of gas from Tamar field become available by pipeline to Israel. BP outbid Gazprom and Eni to win Israel Electric Corporation’s liq-uefied LNG purchase tender in July 2012.

Israel is likely to become both an LNG importer and exporter over the next few years. The large reserves of the Tamar and Leviathan fields dwarf Israel’s energy needs. While 70% of the Tamar gas is designated for domestic supply to Israel, substantial gas reserves remain for export through liquefaction. Noble Energy, lead-ing both the Tamar and Leviathan gas field development projects, signed an agreement in November 2011 with Daewoo to provide a floating liquefaction vessel to be opera-tional by 2016. In March 2012, the Tamar partners signed a 15-year gas sales agree-ment with state-owned utility Israel Elec-tric Corp for pipeline supplies and reported interest from Gazprom to sign a long-term LNG supply deal for up to 3 mtpa.

Jordan has announced plans to mitigate the pipeline gas supply interruption from Egypt by building its own FSRU facility in the port of Aqaba within the next two years.

Kuwait has been importing LNG since 2009 during the summer season through an FSRU operated by Excelerate. In 2011, Kuwait imported some 2.4 mt, mainly from Qatar, but with spot cargoes also arrived from Australia, Egypt, Malaysia, Nigeria, Spain and the UAE. To meet rising fuel demand, Kuwait announced in 2012 that it plans from 2013 to import LNG year-round.

United Arab Emirates (UAE) is plan-ning to expand its LNG imports to meet domestic needs. An FSRU operated in Dubai by Shell since 2009 imported more than 1 mt in 2011, most of which came from a long-term contract with Qatar, but with spot cargoes also arriving from Australia, Malaysia, Nigeria and Trinidad. However, Abu Dhabi announced plans in March 2012 to build an FSRU in Fujairah (i.e., the Emir-ate with a coastline outside the Straits of Hormuz) to bring LNG into the UAE from 2014 without having to ship it through the Strait of Hormuz. This is strategically sig-nificant, as that waterway is under constant threat of closure to shipping from Iran, due to ongoing disputes regarding its nuclear ambi-tions and tightening sanctions.

SOuTH AmErICA DEmANDArgentina imported more than 3 mt

of LNG in 2011 through its Bahia Blanca FSRU facility, with supplies coming mainly from Trinidad, and additional car-goes arriving from Egypt, Nigeria, Qatar and Spain. The year 2012 has been a turbu-

lent year for the LNG sector in Argentina. The nationalization of YPF led to Repsol cancelling its LNG supply contract in May 2012. This retaliation has required Argentina to compete with Asian buyers for spare cargoes at higher prices. Mor-gan Stanley is reported to have delivered some LNG cargoes to Argentina through a barter arrangement, trading the LNG for biodiesel derived from Argentina’s prolific soya crop. This arrangement fol-lowed unsuccessful attempts by Enarsa to reduce prices of cargoes supplied under oil-indexed contracts. High LNG prices led Argentina to sign a deal with Bolivia to supply additional pipeline gas from July 2012 to replace some of its LNG shortfall.

Brazil has two operational LNG regasification terminals. One is located in the northeast (Pecém, onstream 2008) and the other one in the southeast (Guana-bara Bay, onstream 2009). In 2011, Brazil imported 0.75 mtpa of LNG from diverse sources (i.e., Nigeria, Qatar, Trinidad and the U.S.). Petrobras plans to bring a third terminal online in Bahia state in 2013, with a capacity of 500 MMcfgd. Although cur-rently an LNG importer, Brazil is hoping to liquefy the large associated pre-salt gas reserves discovered offshore Brazil, using FLNG technology to satisfy its relatively small-scale LNG import requirements.

Chile has imported LNG since 2010 through two locations: Quintero and Mejillones. In 2011, supplies came from a diverse range of locations: Egypt, Equa-torial Guinea, Indonesia, Qatar, Trinidad, the U.S. and Yemen. Chile’s gas imports rose sharply in 2011 to meet a shortage of hydroelectric power supplies, due to drought. This shortage has prompted com-mitments in 2012 to expand the Quintero plant from a 2.5-mtpa capacity to 3.75 mtpa and northern Chile power producer GasAtacama to award Golar the contract to provide a long-term FSRU at Mejillones from 2015. The new-build FSRU will be moored approximately 1.6 km offshore and in a 50-m water depth. It will be capable of storing 170,000 m3 of LNG and deliver-ing approximately 180 MMcfd, enough to provide power generation capacity of up to 1 gigawatt. There is an option to expand throughput to 360 MMcfgd as demand increases.

Jamaica. LNG is likely to become a more widely used energy source to sup-ply some of the islands that are currently dependent upon burning expensive distillate fuels for power generation. As an example, Jamaica announced in July 2012 that Sam-sung had won a tender to build an FSRU to receive LNG imports for that nation. ■

REFERENCES1 BP Statistical Review of World Energy, June 2012.2 Natural Gas Monthly, U.S. Energy Information Adminis-tration, June 2012

3 Wood, D.A. , “2012.: A review and outlook for the global LNG trade,” Journal of Natural Gas Science & Engineer-ing, Vol. 9, November 2012, pp 16 -27.

DAVID A. WOOD is the principal consultant of DWA Energy Limited, UK, specializing in the integration of technical, econom-ic, fiscal, risk and strategic information to aid portfolio

evaluation and project management decisions. Dr. Wood has more than 30 years of interna-tional oil and gas experience spanning techni-cal and commercial operations, contract evaluation and senior corporate management. He can be reached at [email protected].

lnG, continued from page 10


Roger Williams is Sherwin-Williams’ global market director for fire protection. He has been involved with fire protection for more than 25 years, beginning with an ownership interest in a fireproofing appli-cation company for 16 years. Based in the UK, Williams has worked in sales, market-ing and operations for Leighs Paints, now a member of the Sherwin-Williams fam-ily, for 17 years. Hydrocarbon Processing caught up with Mr. Williams recently to talk about fire coatings.

How do hydrocarbon pool fires and natural gas fires differ?

A hydrocarbon pool fire is a fire where hydrocarbon fuel is burned at atmospheric pressure, the name originating from one of the very early tests carried out where a ‘pool’ of liquid hydrocarbon was ignited. In natural gas fires, these will be under pres-sure and are likely to present as a jet fire.

Whether hydrocarbon liquids are spilt, or gases escape under pressure, when fire ensues, this can result in steel structure fail-ure. It is also possible for cargo contained in localized storage vessels to become sub-ject to a rapid rise of temperatures, thus escalating the situation.

is one more intense than the other?Jet fires are significantly more severe

than pool fires, with greater heat flux and significant erosive potential.

During a hydrocarbon jet fire, the cargo, such as natural gas, is released at pressure, the temperature climbing up to 1,200°C. The resulting flame can impinge surround-ing areas with significant velocity and be highly erosive. In the event of hydrocarbon pool fires, or fire resulting from spillage of cargo, temperatures can reach 1,100°C.

Does gas processing require a different set of preventive coatings?

The products used for jet fire protection may or may not be the same as those used for hydrocarbon pool fires. It is essential that the chosen product has been tested to the relevant standard for the fire protection required. The FIRETEX range of products includes those that can be used for both pool fire and jet fire protection, and those that are suitable for pool fire protection only. Gas processing does also present its own unique set of challenges, especially where LNG is concerned, due to the extreme cold temperatures involved. In the event of “cryogenic spill,” there is significant risk of cold-induced brittle fracture of carbon steel, leading to significant damage and the potential for a catastrophic event.

What preventative measures would you take when outfitting an FLNG vessel to ensure against a catastrophic cryogenic spill?

The project will determine the risks associated with the specific process design, but this will often require both insulation against cryogenic cracking of carbon steel and subsequent fire protection against either an LNG pool fire or a pressurised release (jet fire). The FIRETEX range includes epoxy thermal insulation for pro-tection against ‘cold shock’ and epoxy fire

proofing for protection against pool fire and jet fire.

Natural gas is priced much lower than crude oil. Are your products priced differently to serve the natural gas industry as opposed to refiners?

FIRETEX provides extremely cost-effective fire and cryogenic spill protection systems for use across the gamut of the oil, gas and petrochemical industries and our pricing is not related to spot markets.

Tell us what you are most looking forward to at Gastech.

Gastech is a great opportunity to share with our customers the next generation of fire protection with the launch of our M90-02 series. With improved char strength,

greatly reduced thickness and an industry leading range of steel sections covered, FIRETEX M90-02 provides a competi-tive, cost effective solution for protection.

What is the exhibition theme for Sherwin-Williams at Gastech this year?

This year our exhibit theme focuses on protecting life and assets, globally. Sherwin-Williams is the oil and gas industry’s global asset protection partner, offering coating solutions to meet the needs of upstream, midstream and downstream segment. We are committed to delivering quality, value, service and logistical support unmatched by other coatings companies in the market.

Special emphasis will be placed on our FIRETEX passive fire protection and cryo-genic spillage protection technologies. ■

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GAZTRANSPORT & TECHNIGAZ1 route de Versailles, 78470 Saint-Rémy-lès-Chevreuse - France

Tel: +33 (O)1 30 234 789

E-mail : [email protected]

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SOLUTIONS

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GTT, through its experience in the design of LNG handling and storage systems, both at sea, and on land, is ideally positioned as the preferred partner for the implementation of clean, efficient and reliable solutions at each step of the supply chain.

GTT has solutions for land storage tanks, and bunker tanks for all types of vessel.

Protecting your facility from fires and cryogenic spills

RoGeR WiLLiAmS, Sherwin-Williams


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• ThreeFloatingStorageandRegasificationUnit’s(FSRU’s)onorderfromHyundaiHeavy

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Lurgi Fixed Bed Dry Bottom (Lurgi FBDB) gasification processAPPLICATION

Lurgi FBDB coal gasification is a well-proven technol-ogy for the conversion of coal to synthesis gas, consist-ing mainly of H2 and CO. The strongest attribute of the Lurgi FBDB gasification process is its long track record for large-scale applications over many years of opera-tion, along with optimum performance featuring modular design, high reliability, and gasification efficiency with low oxygen consumption.

All types of coal ranks have been commercially gas-ified; however, the competitive advantage of the Lurgi FBDB gasifier is the highest for low-rank, high-ash-con-tent coal. Coal conditioning upstream of a Lurgi FBDB coal gasifier is appreciably low compared to the coal pretreatment requirements of other coal gasification prin-ciples. Air Liquide Global E&C Solutions used its experi-ence in gasification, synthesis gas cleaning, and synthesis technologies to further improve the Lurgi FBDB coal gas-ification technology. The process was made more envi-ronmentally friendly and suitable for a number of appli-cations, including synthetic natural gas (SNG), reduction gas for direct reduction iron (DRI), coal-to-liquids (CTL), chemicals and transport fuels.

DESCrIPTIONTwo sizes of the Lurgi FBDB gasification reactor are

commercially available in the form of the Mark 4 (Mk 4) and Mark Plus (Mk+) gasifiers. Continuous improvement, taking into account higher safety, reliability and avail-ability by having better equipment design features, better choice of material and special manufacturing require-ments, has led to the latest Mk 4 (design pressure of 40 barg) reactor. To further enhance the economic viability for high-capacity coal gasification projects (e.g., SNG plants), the new generation Mk+ gasifier is designed for doubled single-gasifier capacity and elevated pressure (design pressure of 60 barg).

The purpose of the Lurgi FBDB Mk+ gasifier is to gasify coal under pressure of approximately 50 barg, in the presence of steam and oxygen, to produce synthesis gas. The screened coal feedstock (particle size 5 mm–50 mm) is fed into the gasifier from the top via twin coal locks, while the gasification agents, steam and O2 (ASU, 10), are fed from the bottom (1). The gasifier operates below the ash-melting temperature and, hence, the dry ash leaves the gasifier at a certain frequency, depending on the amount of ash produced via the ash lock at the bot-tom. Coal and ash locking are a batch process. Steam is used as a moderator to ensure that no melting/clinkering of the ash occurs. The required steam-to-oxygen ratio will be dependent on the melting properties of the ash (~ 4 kg steam/Nm3 O2 for high-melting ash, and up to ~ 7 kg steam/Nm3 O2 for low-melting ash).

The produced syngas exits the gasifier at relatively low temperatures (approximately 400°C–600°C), depending on the rank and properties of the coal. The raw gas is cooled (and possibly shifted to the H2 /CO ratio required by the downstream synthesis process) in the gas cooling section (2) of the gasification island, producing dry, raw syngas. Note that part of the CO shift has already taken place inside the Lurgi FBDB reactor due to low-reaction end temperatures resulting from the countercurrent pro-

cess principle and excess steam present from the agent. The raw gas will also contain CH4 and higher hydrocar-bons, which makes the Lurgi FBDB process specifically suitable for SNG production. The elevated pressure of the Mk+ gasifier favors even higher CH4 yield.

Downstream gas purification units (configuration dependent on final product) purify and condition the generated synthesis gas to meet the required product specification—e.g., Lurgi Rectisol (3) to recover naphtha and remove sour gases; Lurgi Sulfur Management (4) to recover sulfur; and Lurgi Methanation (5) for SNG pro-duction, as shown in the diagram. Gas liquor condensate accumulated in the cooling section (2) is treated in the liquid chain of the process, which comprises the Lurgi GLS unit (6) for extraction of the valuable co-products (tar and oil) formed during gasification. This is followed by the recovery of phenols in the Lurgi Phenosolvan unit (7). Liquid ammonia is recovered in the downstream ammonia recovery section, the Lurgi CLL unit (8). The liquid chain then enters into the wastewater treatment unit (9), which takes care of the final treatment of the water to the requested purification extent. Then, the water can be completely reintroduced to the water circuit of the plant, resulting in Zero Liquid Discharge (ZLD).

ECONOmICSCharacteristic figures are presented for a Lurgi FBDB

Mk+ gasifier per ton of typical lignite coal feedstock [on a dry-ash-free (daf) basis]. These figures are coal-specific and will vary with coal rank and ash-melting properties:• H2-to-CO ratio: 1.5–2.5• kg O2 /kg coal, daf: 0.3–0.5• Gas production: ~ 2,000 Nm³/ton coal, daf• CH4 in raw gas: 9–16 mol%

• Carbon conversion: > 99%• Cold gas efficiency: > 87%• Thermal efficiency ex-gasifier: > 94%• Thermal rating: > 500 MWthermal

INSTALLATIONSTo date, over 100 gasifiers based on Lurgi FBDB gasifi-

cation technology are in operation around the world. These installations include:• The world’s largest coal-based Fischer-Tropsch

chemicals and fuels production plant, built for Sasol (Secunda, South Africa; bituminous coal)• Coal-to-SNG plant for Dakota Gasification Co.

(Beulah, North Dakota, US; lignite coal)• Coal-to-ammonia plant for Tianji Coal Chemical Co.

(Tianji, China; anthracite coal)• Coal-to-methanol plant for Yima Coal Gasification

Co. (Yima, China; sub-bituminous coal).

rEFErENCESBlostein, B., M. Devaux, D. Gruson and F. Judas, “Coal

Gasification for DRI: A New Cost-Effective Ironmaking Route,” Steel Tech, Vol. 5, No. 1, October 2010.

Fu, G. and J. Zhu, “Lurgi FBDB Coal Gasification Technology and Latest Advances,” Sino-Global Energy, January 2012.

LICENSOrLurgi GmbH, Air Liquide Global E&C Solutions ■

This process information is excerpted from Hydrocarbon Processing’s 2012 Gas Processes Handbook. For more information about the handbook, please visit www.gulfpub.com/GPH.

Sulfurrecovery unit

ASU

Steam

Coal AshTar Condensate

Oxygen

Lurgi FBDBgasification

CO shift andgas cooling

Lurgi GLSunit

LurgiPhenosolvan

Lurgi CLLunit

Wastewatertreatment

Methanation

Elemental sulfur

HP steam

Synthetic natural gas

CO2 rich gas

Liquid ammonia

Phenols

Naphtha

Oil

Clear tar

LurgiRectisol


In this article we want to explore the need and availability of protection meth-ods for direct (DEHE) and in-direct (IEHE) electric heat exchangers, aka circulation heaters. An example of a circulation heater bundle for a DEHE with a hazardous loca-tion electrical enclosure is shown in Fig. 1.

DEHEs and IEHEs are used to heat gases such as nitrogen, hydrogen and hydrocar-bons, as well as liquids, such as water, oils, acids, solutions and other fluids. They are also used in a wide variety of industries including crude oil refining, gas process-ing and transmission, chemical reactors, petrochemical and pharmaceutical.

Electrical equipment, such as a DEHE, needs to be specially designed, tested and certified for the intended installa-tion. In electrical engineering, a hazard-ous location is defined as a place where concentrations of flammable gas, vapor or dust occur, which can cause danger for employees working in such environments. In hazardous locations, electrical arcs or high surface temperatures can ignite the surrounding atmosphere. As a result, there are additional safety concerns for work-ers and the general public that need to be addressed. The electrical load connection enclosure installed on the heater bundle, shown in Fig. 1, includes one type of pro-tection method suitable for hazardous loca-tions. The example shown in Fig. 1 illus-trates the protection method known as “d” type, or a flameproof enclosure. The “d” type of protection method will be discussed later in this article.

Due to the dangers of electrical equip-ment in hazardous locations, a substan-tial part of electrical codes are devoted to the discussion of hazardous locations and the definition of areas classified as such. There are many country and national standards that apply, and one global orga-nization, the International Electrotechni-cal Committee (IEC), that write standards for hazardous locations. See Table 1 for examples of the standards.

Within each standard there are different protection methods. Protection methods are simply the various approaches used to insure the equipment is safe to operate in the location of installation. There are many different types of protection methods. For example, the IEC has at least the following explosion-protection schemes:• Flameproof (Ex d); Increased safety

(Ex e); type of protection “n” (Ex n);• Intrinsic safety (Ex i); Encapsulation

(Ex m); Oil immersion (Ex o); Pres-surization (Ex p);

• Powder filled (Ex q) for gas atmo-spheres and Protection by enclosures-Dusts (Ex tD or Ex t); Pressurization-Dusts (Ex pD); Encapsulation-Dusts (Ex mD

• Intrinsic safety-Dusts (Ex iD)This article will focus on the type “d”

and “e” methods available in the IEC and European Normalization (EN) standards. Both of these protection methods are com-monly employed on DEHEs. The follow-ing is a comparison of both protection methods:

Flameproof enclosure. Examples of applicable standards are EN 60079-1, UL 60079-1, IEC 60079-1 and/or FM 3600.

There are many installed DEHEs around the globe with the “d” protection method. A certification for a “d” protected DEHE can apply to the heat exchanger bundle, or to the bundle and the pressure vessel in which the bundle is installed. Each DEHE has a terminal enclosure designed for elec-trical connection to the heater load. The DEHE terminal enclosure is constructed, such that it can withstand an internal explo-sion, while providing relief of the resulting internal pressure via flame gap(s), such as the labyrinth created by threaded fittings or mating machined flanges.

Ignition inside the terminal enclosure will cause the gases contained within to have an elevated temperature. The design of the enclosure must assure that they are sufficiently cool when they reach the outside of the terminal enclosure. Gases exiting at a temperature above a safe limit could ignite any surrounding hazardous gases that might be present. Each gas has its own auto-ignition temperature to con-sider when present in ignitable concentra-tions. The ignitable concentration is not the same for each gas. Some examples of auto-ignition temperatures for a few gases are shown in Table 2.

The gap and distances for either a threaded or machined surface escape path must be tightly controlled. The terminal enclosure on the heater bundle shown in Fig. 1 is an example of a mating machined surface construction. The various stan-dards provide acceptable flameproof gaps for the various acceptable joint types, depending on factors, such as the type of hazardous gas and terminal enclosure vol-ume.

It should be noted that while a properly designed terminal enclosure will withstand the explosion as noted earlier, it is likely that residue from the combustion will be deposited on interior surfaces of the ter-minal enclosure. This residue can cause electrical paths to become polluted, thus reducing electrical surface resistance. This condition could lead to electrical arcing between load connection terminals. Arc-ing generally leaves an arc path, which promotes further arcing and potential fail-ure of electrical bussing or termination. It is important to periodically inspect type “d” electrical enclosures to look for evi-dence of arc tracks. If tracking evidence is found, clean the affected surfaces as needed before putting the heat exchanger back in service.

Increased safety. Examples of appli-cable standards are: EN 60079-7 UL 60079-7 / IEC 60079-7 FM 3600. In com-parison to the “d” type protection method, the “e” type of increased safety equipment is intended to increase the safety. In the case of a DEHE, additional measures are employed to increase the level of safety. The increased focus assures that electri-cal arcs and surface temperatures will not reach levels that could ignite a hazardous mixture in normal service. DEHEs using the “e” type of protection method can use terminal enclosures capable of withstand-ing an explosion, but they more typically use sheet metal types of enclosures. These devices often include oversized electrical bussing, increased convective cooling fea-tures, as well as increased internal volume.

Special attention is given to the design of the control system to assure the DEHE can be shut down as needed before surface temperatures reach levels that could ignite a hazardous atmosphere.

Extent of coverage. There is a com-mon misconception that a hazardous certi-fication nameplate covers only the terminal enclosure. Whether the protection method is “d” or “e,” the hazardous certification covers the entire heat exchanger bundle or exchanger. All DEHE’s used in a hazard-ous locations should include certifications covering the complete heat exchanger and not just the terminal enclosure. An enclo-sure with a hazardous location nameplate does not mean the certification is transfer-rable to a higher level assembly. Buyers should be sure their DEHE has been prop-erly designed, tested and certified as an assembly for the type of protection desired.

LNG. Liquefied natural gas (LNG) pro-cessing applications that utilize heat exchangers, electric or non-electric, are routinely located in hazardous locations. Applications ranging from dehydration to compressor trains have thermal require-ments in LNG processing. The thermal needs are routinely met with a variety of heat exchanger styles. The presence of haz-ardous gas in or around equipment, such as re-boilers, compressors and gas seal panels, requires heat exchangers that are designed and certified for the installation. The “d” and “e” type of protection methods are two commonly employed protection schemes on DEHEs and IEHEs in these applications.

There are trade-off curves associated with the selection of all the available protection schemes. The trade-off curves include considerations like physical size, cost and durability. Contact your thermal engineering professional to help with the decision around which protection method to choose. ■

DENNIS LONG is the global marketing director for the Energy Processes and has more than 29 years of experience at Watlow in the design and application of DEHEs. For more informa-tion, visit www.watlow.com.

Comparison of hazardous location protection methods for direct and in direct electric heat exchangersdenniS lOnG, Watlow

FiG. 1. An example of a circulation heater bundle for a DEHE with a hazardous location electrical enclosure.

TABle 1. Examples of electrical code standards.

Location Standard Area classification Temperature

International IEC 60079-2 Zone 1 or 2, Croup II A, B or C T1-6

Canada E60079-2 Class 1, Zone 1 or 2, Group II A, B or C T1-6

USA NEC 505 ISA60079-2 Class 1, Zone 1 or 2, Group II A, B or C T1-6

USA NEC 500 NFPA 496 Class 1, Division 1 or 2 Group D, C, B and A T1-6

Europe EN60079-2 Zone 1 or 2, Group II A, B or C T1-6

Australia IEC 60079-2 Class 1, Zone 1 or 2, Group II A, B or C T1-6

TABle 2. Examples of gas ignition temperatures

Fuel or Chemical

Temperature

(°C) (°F)

Acetaldehyde 175 347

Acetone 465 869

Acetylene 305 581


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Gas Supply & Demand Dynamics

Financing Regional Gas Projects & Infrastructure

Regulatory Keynote Address – The United States

A GASTECH REGIONAL EVENT

Part of

The Role of Natural Gas & LNG in the Race to Fuel Asia

Meet global energy & project leaders and understand the future for gas demand & supply in Asia

Book your place today, contact Satish Chandran +65 9355 7849 or email [email protected]

Spaces are strictly limited and subject to availability

Industry Support from

Recreate PMS(from pdf )

Katan HirachandManaging Director

Energy Project Finance

Societe Generale

S. IswaranMinister Prime

Minister’s Office & Second Minister for Home Affairs & Trade and Industry

Singapore Government

Duncan van BergenGeneral Manager Global Gas & LNG

Market DevelopmentShell Upstream

International

Dr. Mitchell BaerDirector

Office of Policy and International Affairs The United States

Department of Energy

B.C. TripathiChairman &

Managing DirectorGAIL (India) Ltd


TueSDAy 9 oCTobeR 2012

GAS PRoCeSSiNG FLoATiNG LNG LNG AS A SHiPPiNG FueL

CoTe Theatre A CoTe Theatre b CoTe Theatre C

introduction 10:30-10:35

Chair’s introductory RemarksJohn Sheffield, Consultant/Instructor, John M. Campbell & Co.Adrian Finn, Process Technology Manager, Costain Energy & Process

Chair’s introductory RemarksPaul Jukes, President, MCS Kenny & Chairman, Institute of Marine Engineering, Science & Technology Offshore Oil & Gas Special Interest Group (SIG)

Chair’s introductory RemarksLuis Benito, Global Strategic Marketing Manager, Marine, Lloyd’s Register Asia

Session 1 10:35-11:00

optimised Design for Tight Gas Gathering SystemsAhsan Iqbal, Senior Process Engineer, WorleyParsons Europe

FLNG: Game-Changing Prospects for the LNG SectorSteve robertson, Director, Douglas-Westwood Ltd

Legislative Drivers for LNG as FuelPeter Catchpole, Principal Environmental Specialist, Lloyd’s Register

Session 211:10-11:35

Liquefaction Process Technology for mid-Scale PlantsWilliam P. Schmidt, Technology Manager—LNG Process Engineering, Air Products and Chemicals, Inc.

Quantifying Performance from Concept Selection through Detailed DesignCarlo Buccisano, Principal Consultant—Head of Section, Det Norske Veritas Ltd

LNG as Fuel Technology: engine and Propulsion ChoicesGeir Bjorkeli, Vice President, Systems Sales & Marketing Campaigns Merchant Vessels, Rolls-Royce

Session 311:45-12:10

efficient Nitrogen Removal from LNGJorge Arizmendi-Sanchez, Senior Process Engineer, Costain Energy & Process

managing FLNG Project RiskJohn maguire, Structural Engineering Manager—Technical Investigation Department, Lloyd’s Register EMEA

LNG as Fuel Technology: Ship Designs—from a builder’s PerspectiveOdin Kwon, Vice President, Basic Planning Group Leader, Daewoo Shipbuilding & Marine Engineering Co., Ltd.

Session 412:20-12:45

Design Capacity Assessment of the Norwegian Transport System for Natural Gas by using a Novel HySyS and excel Analysis ToolCraig Branch, R&D Manager, Genesis Oil and GasChristian Aaserud, Advisor Technology, Gassco

Choosing a Liquefaction Technology for your FLNGBryan J. Trocquet, Manager Select Engineering, WorleyParsons

LNG as Fuel Classification: Design Process for LNG Fuelled ShipsEdward Fort, Global Head of Engineering Systems, Lloyd’s Register

12:45-13:45 Lunch Lunch Lunch

Session 5 13:45-14:10

Desulphurisation and mercury Removal from Natural GasesVince Atma row, Global Product Manager, Johnson Matthey

FLNG Containment SystemsHolger Kelle, Manager, Floating Systems Group (Melbourne), INTECSEA, WorleyParsons Group

Commercial Drivers for LNG as FuelVeronique Pastre-maravic, Director, Clarksons LNG

Session 614:20-14:45

Factors Determining Full Reclamation or Slipstream Reclamation for meG RecoverySimon Crawley-Boevey, Technology Manager— MEG Reclamation, Cameron’s Process Systems

LNG Subsea Loading LinesColin mcKinnon, Technical Director, J P Kenny Limited

LNG as Fuel operation: Lloyd’s Register bunkering infrastructure StudyLatifat Ajala, Marine Market Analyst, Lloyd’s Register

Session 7 14:55-15:20

Selection of LNG Liquefaction Technology for FLNG operationsJohn Sheffield, Consultant/Instructor, John M. Campbell & Co.

Advanced Technologies for Cryogenic TransferCyril morand, Substructure and System Manager, Technip

LNG as Fuel operation: Shuttle Tanker and Ship-to-Ship TransferStephen Davidson, Vice President—LNG, SPT

Session 8 15:30-15:55

yamal LNG Projectmartin mayer, Director of LNG Technology, CB&I

Fuel Flexibility for Power Plants onboard offshore Storage & Production unitsJeroen van Keep, Business Sales Manager Offshore, Wärtsilä

LNG as Fuel Classification: the Viking Project—a Case StudyThanos Koliopulos, Special Projects Manager, London Energy Operations, Lloyd’s Register

Closing Remarks 15:55-16:00

Closing Remarksmartin mayer, Director of LNG Technology, CB&IDavid Healey, Business Development Manager, LNG, Air Products and Chemicals, Inc.

Closing RemarksPaul Jukes, President, MCS Kenny & Chairman, Institute of Marine Engineering, Science & Technology Offshore Oil & Gas Special Interest Group (SIG)

Closing RemarksLuis Benito, Global Strategic Marketing Manager, Marine, Lloyd’s Register Asia

16:00-17:00 Networking Reception Networking Reception Networking Reception

Technological innovation is a key factor in propelling the global gas industry into the “Golden Age for Gas.” That is why we are proud to present the Gastech Centres of Technical Excellence (CoTEs) as a returning feature at this year’s exhibition.

Once again, we are working with many of the world’s most-respected industry

associations and organisations to bring together high-level speakers, who will provide significant insights and updates about the latest developments in gas technology. Split into 12 streams, leading experts will provide a comprehensive and expert insight into many of the technological advances from recent and future projects. ■

Centres of Technical Excellence (CoTEs)

Gas processing is the key to a successful energy industry

One of the major technological advances that has revolutionised the gas industry is liquefied natural gas (LNG), as well as the potential cost-saving benefits to consumers and operators of floating LNG (FLNG).

Yet it is the processing segment of the gas industry that rarely receives public attention, despite its enormous importance to the entire supply chain. Since the early days of the energy industry in the 1800s, natural gas and gas liquids have supplied about one-half of total petroleum produc-tion in the U.S., alone.

It is an exciting time to be involved in the gas processing section of the energy industry—but one that comes with a mul-titude of challenges, according to John Sheffield, of the Gas Processors Associa-tion Europe (GPAE). “The gas market has grown beyond recognition in recent years, and while a major part of that revolution has been LNG, it is clear that the dawn of FLNG will lead to new and exciting oppor-tunities,” Mr. Sheffield said.

Mr. Sheffield will be among the speak-ers involved in the Centres of Technical

Excellence (CoTEs), a free-to-attend tech-nical seminar programme on the Gastech exhibition floor. An industry leader joining Mr. Sheffield within the same Gas Process-ing stream today is William P. Schmidt, technology manager for LNG process engineering at Air Products and Chemi-cals, who will discuss liquefaction process technology for mid-scale plants.

The Gas Processing stream is a part of the comprehensive technical seminar pro-gramme comprising 12 different streams. Other top speakers at the CoTEs include chief executive officer of Sakhalin Energy, Andrei Galaev, who yesterday discussed the Sakhalin-2 project, a sub-Arctic suc-cess story, within the Project Delivery stream, and Rustom Mody, the vice presi-dent of completions technology at Baker Hughes, who will tomorrow specifically address innovative completion technolo-

gies that enhance well performance in the Unconventional Gas stream.

INFRA Technology’s chief technical offi-cer, Dr Vladimir Mordkovich, will explain the organisation’s new energy transforma-tion technologies. The Institute of Marine Engineering, Science and Technology (IMarEST) will play a key role in presenting a day-long specialist FLNG stream today.

The CoTEs exhibition show floor semi-nars are designed to provide a platform for many of the world’s most-respected indus-try associations and organisations. These include the Carbon Capture & Storage Association for Carbon Capture & Stor-age, Lloyd’s Register for LNG As A Ship-ping Fuel, and the International Institute of Refrigeration for Cryogenics.

To register for the Gastech Exhibition and to reserve a free place at the CoTEs please visit www.gastech.co.uk/cotes. ■

JoHN SHeFFieLD of the Gas Processors Association Europe


Did you know that Titan, one of the moons of Saturn, is a potential source of phenomenal amounts of LNG? The lakes of methane gas at its poles could contain as much as one-quarter of the world’s total reserves of natural gas and oil, said Pro-fessor Brian Cox of Manchester Univer-sity, addressing Gastech delegates yester-day Monday.

Besides being Professor of particle physics, Cox is a well-known presenter of UK television programs about astron-omy and physics. In his slot as the Gas-tech Inspirational Keynote speaker, he had a free choice of subject matter, but had clearly sought to tailor his remarks to his audience.

After quantifying Titan’s LNG potential as 150 times 10, to the power of 12, liters of methane, Professor Cox quickly went on to point out that with the current cost of launching material or substances into space running at US$10,000 per kilogram, this resource was not one that was going to be exploited very soon. This particularly “unconventional” source of gas had been investigated by the Cassini spacecraft, Cox said. He introduced several spectacular photographs of Saturn and its moons taken by the “unconventional explorer,” which was launched in 1997 and is still transmit-ting data to this day.

After touching briefly on measure-ments of energy, mass and volume, Cox explained that the theory that underpins all our concepts of mass is the existence in space of the Higgs particle (or boson). This theory, first postulated in the 1960s by Professor Peter Higgs and others, says that “all that empty space is crammed with them,” said Cox. And it was to test this theory that the Large Hadron Collider was constructed at the CERN laboratory near Geneva, Switzerland. Cox works on the ATLAS experiment at CERN. “What the Large Hadron Collider does is to help us recreate the conditions that were present less than a billionth of a second after the Universe began,” he said.

Scientists at CERN had been using the LHC to search for the Higgs particle, and were delighted this summer to have found evidence of its existence. Cox showed his listeners the diagram of particle collisions inside the LHC, which provides evidence of Higgs boson particles by showing the debris caused by their decay.

The energy in the Higgs particle field is what lies behind the acceleration of the expansion of the universe, Cox said. More work needs to be done, however, on estimating the precise amounts of energy involved. Cox went on to explain that

projects such as the search for the Higgs boson are important, because they inspire the next generation of engineers and sci-entists, and he called for support in doing this. “We need more than 1 million new engineering, math and science graduates in the next few years, just to maintain the status quo,” he warned.

And, concluding, Cox turned to the preface setting out the aims of the Royal Institution, written by British naturalist and botanist Sir Joseph Banks. He said he would like to give a copy of this to “every prime minister in every country” to stress the importance of scientific research. The Royal Institution document set out “the public advantages of disseminating of a spirit of investigation” among the opin-ion formers of its day. “It is still as rele-vant today as in 1799,” he told delegates, because it had “laid the foundations for your work in the energy industry.” ■

STaToil, continued from page 1

Panel members listening closely to fellow panelist Helge lund (left), President and CEO, Statoil, included sHigeru Muraki, Executive V.P., Tokyo Gas; kHalid sultan al-kuwari, Marketing and Shipping Executive, RasGas; djeloul BacHi-Bensaad, Director, Production Division, Sonatrach; and Bill dudley, President and COO, Bechtel Corp.

proFessor Brian cox poses for a photo with a fan.

though small regional differences will always occur.”

The added integration, however, will increase competition to secure supply from new LNG sources, he cautioned. In recent years, Europe has been well-sup-plied in terms of import diversification, but a more open, global marketplace could bring rival suitors.

“For Europe, policies that cater for gas to have a long-term role are crucial,” Lund said. “Consumers look at the security of supply, while for the producers, it’s about the security of deliveries and demand. The interests of both parties must be taken into account, for a stable energy relationship to occur.”

If those factors occur, the industry is indeed in a “golden age,” Lund concluded. ■

long term, the climate change challenge will impact the role of gas. Yet we should recognise that for now, gas is helping many countries cut their carbon emissions, including Britain. I believe that for some time yet, gas will be as important for the UK as in the past.” He said that while climate change is a global issue, global solutions have been elusive. Davey remains committed to taking the global objective agreed upon in Durban last December and taking it further in Doha, later this year, to reach a new, binding agreement for all countries by 2015.

“That means agreeing a high-level work plan for its delivery, making progress in closing the gap to our 2°C goal, adopting a second commitment period to the Kyoto Protocol, and continu-ing to build the necessary international architecture,” explained Davey. In the meantime, UK officials will continue following a “trajectory to a low-carbon economy.” Britain is reducing its own emissions through energy efficiency and low-carbon technolo-gies, such as renewables, nuclear, and carbon capture and stor-age,” while “giving investors some certainty to make long-term investment decisions.

Avoiding “gas complacency.” Looking toward the future, Davey said the UK need its rate of investment in energy to increase substantially, to provide the energy security its citi-zens expect. “Despite the good shape of Britain’s gas market, we cannot afford to be complacent now, or in the future, when it comes to energy security,” mused the Secretary. “We are working internationally to encourage investment in new gas production, supporting UK companies overseas. We are encouraging diverse and efficient liberalised gas markets; we are encouraging energy efficiency measures; and we are supporting the opening of new gas supply routes.”

Davey said that gas will play an important role in ensuring secure supplies for Britain’s electricity. Around 20% of existing electricity generating capacity will be shut down over the next 10 years. Yet, over the next 20 years, UK electricity demand is pro-jected to rise significantly, as heat and transport are increasingly electrified. Davey pointed out the financial ramifications: “We are likely to need something like £110 billion of investment in elec-tricity generation and transmission by 2020, requiring a doubling of the current rate of investment. Gas will obviously continue to be the key energy source for heat in many of our buildings in Britain, for years to come. But in electricity generation too, I see unabated gas playing a very significant role throughout the 2020s, and, increasingly, as back-up, or with carbon capture and storage, through the 2030s and 2040s.”

The Secretary also commented on unconventional gas. “I know that some British commentators are impatient about this,” said Davey. “They excitedly tout shale gas as a silver bullet, to bring Britain to a new age of cheap energy. And some have accused me of blocking progress on shale, on environmental grounds. Let’s be clear. In principle, I’m all in favor of exploiting new resources. I would welcome as much as anyone a way to boost Britain’s indigenous gas supplies and to reduce energy prices……”

A somewhat defiant Davey continued, “But I make no apology for being a little more patient than those excited commentators. I want to base our approach on the evidence, as we do for all fuel sources. I know that industry analysts do see shale as a rather different proposition here than in the U.S.” He said that ques-tions about regulatory oversight and the involvement of local communities need to be answered rather than simply dismissed. In the end, said Davey, “I hope it will prove possible for me to give a green light to shale. ■

energy SecreTary, continued from page 1

Professor Cox offers inspirational remarkseloiSe logan

Lunch among friends at Monday’s delegate lunch.


Industry leaders and delegates were treated to an impressive selection of stands at the Gastech Exhibition, fea-turing the most prominent names in the global gas industry today.

The scale of the event was brought home to all those visiting the exhibition by the sheer range of top organisations that were taking advantage of the oppor-tunity to put themselves in front of an extremely knowledgeable audience.

Among then was Sandy Dunlop, exec-utive administrator for the Gas Processors Association (Europe). As well as exhibit-ing, the GPAE is participating in the Gas Processing stream, within the Centres of Technical Excellence (CoTEs), a free-to-

attend technical seminar programme on the Gastech exhibition floor.

Mr Dunlop, speaking on the represen-tative organisation’s exhibition stand, hailed Gastech as the ideal venue for raising awareness of the GPAE and the benefits it brings to its members.

He said he was particularly looking forward to the Gas Processing CoTE after the organisation’s presentation at last year’s Gastech conference and exhi-bition – in Amsterdam—drew a large and influential audience.

“We are running one of the CoTEs on Tuesday, and when we ran it last year in Amsterdam, it was extremely success-ful,” Mr. Dunlop said. “We represent the

gas processors of the industry, and we participate in all major events around Europe.”

“The benefit of being here is that we have an ideal opportunity to raise the profile of the GPAE; a lot of people, within the midstream sector, are aware of us, but our aim is to reach out to oth-ers, beyond the engineers, and to make those really important connections,” he said. “Effectively, having a presence at a major event like Gastech provides the opportunity to get in front of not only the right people, but new people as well. We hope to have an excellent audience for the CoTE, where we will be presenting a total of eight papers for discussion.” ■

‘golden age of gas’ to drive growth in floating lng and bunkering projects

Bill Sember, ABS vice president of global gas development, has predicted rapid growth in new FLNG projects and the increased application of LNG as a marine fuel.

Sember, who is chairing today’s tech-nical session on Floating LNG, offered a preview of his remarks in an interview with Hydrocarbon Processing.

He predicted that the industry would see an FLNG vessel contracted by the end of the year. That prediction was proven cor-rect in the form of Shell’s Prelude FLNG unit, which will work in the Browse Basin offshore Western Australia. Prelude will be the largest vessel of its type built to date at 600,000 dwt.

The Prelude project received environ-mental approval in late 2010 and has a target production start date of 2016. This project will be followed closely by several others offshore Indonesia and Malaysia.

“While FLNG is a relatively new development, I think it is one of the most exciting areas of LNG, and it is one ABS and I have been involved with since the beginning,” Sember said. “My predic-tion for 2012 is that once these facilities have proven themselves, we will see many more deployed around the world in remote areas and in places where it is impractical or cost prohibitive to build onshore pro-cessing facilities.”

Behind this development lies the increasing demand for gas globally as importer countries seek to balance their energy mix and produce cleaner energy.

Sember cited an International Energy Agency (IEA) 2012 estimate that puts recoverable conventional gas resources at around 400 trillion cu m and unconven-tional resources at a similar size. The IEA predicts that global gas usage will rise by more than 50% from 2010 levels and account for more than one-quarter of global energy demand by 2035.

“We’ve heard this era referred to as the golden age of gas. While on the face of things, this might sound like an exaggera-tion, I believe it is appropriate,” Sember said. “Supplies are enormous, and global demand is growing. Before long, gas will compete with oil in terms of global demand and usage. The potential for natural gas development presents us with a world of opportunity and the use of FLNG will be vital to help meet a portion of that demand.”

ABS has a long pedigree in LNG that includes classing the first LNG carriers built in China and the first Offshore Sup-port Vessels to be powered by LNG as fuel. The class society is also supporting efforts by vessel designers to lead devel-opment of innovative solutions that make new LNG shipping and bunkering appli-cations a reality.

Most recently, ABS has granted approval in principle (AIP) to Waller Marine Inc’s concept design for a liquefied natural gas (LNG) carrier and regasifica-tion tug barge.

The Waller Marine concept allows LNG to be transported and delivered efficiently on a scale where large LNG infrastructure could be cumbersome, costly and time consuming to develop. The design also reflects the shift toward LNG as fuel by using natural gas in the dual fuel engines of the tug barge unit.

“ABS has been a great resource in developing this product,” said Waller Marine Gas Solutions Vice President Bill Hutchins. “By conducting multiple reviews, including a hazard identification study, ABS has helped us to make sure that safety and regulatory aspects have been appropriately addressed.”

The vessel will have the ability to load from existing tanks, liquefaction facilities or traditional LNG carriers and transport cargo to existing tanks, traditional LNG carriers, trucks or to other ships using LNG as a fuel. It also is equipped for regasifica-tion of LNG directly to a pipeline or to a power plant.

ABS worked with Houston-headquar-tered Waller Marine from the inception of the project and has been the premier certifi-cation body in reviews, including conduct-ing the AIP program review.

“Just as in FLNG, we are going to see a seismic shift in the use of LNG as fuel,” said Sember. “Ferries are already adapting and emissions regulations will mean that more vessels that can use LNG will do so. A number of big names are moving ahead of the pack and the challenge of providing the fuel is another one that ABS is helping the industry address.”

infield at gastechInfield Systems is exhibiting at Gastech

in Booth A289. The company is showcas-ing our core market intelligence products and services for the global subsea oil and gas industry.

Infield Systems is announcing the timely publication of its latest report, the second edition of its Offshore LNG Market Report To 2018. The launch of this report at Gas-tech 2012 coincides with a particularly exciting time for this sector of the offshore oil and gas industry, following Shell’s announcement that it has sanctioned the world’s first floating LNG project, Prelude. It is widely expected that this will mark the beginning of a more widespread use of this potentially market changing technol-ogy. Infield Systems’ latest Offshore LNG report analyses the value of the sector and the drivers for floating liquefaction and off-shore regasification; as well as providing a regional assessment of the market outlook and an analysis of the number of stranded gas assets worldwide that could be suitable for development using FLNG technology.

At Gastech you will also have the oppor-tunity to review the full range of Infield Systems’ products and services, including: the complete range of oil and gas market sector forecast reports, our proprietary oil

and gas databases and our unique GIS map-ping system. The Infield Systems’ team will be on hand to provide advice and guid-ance about the products which will best suit your business needs. There will also be the opportunity to collect free copies of Infield Systems’ other published oil and gas activ-ity maps, including: the Norwegian, Bal-tic & Barents Seas, Arctic Frontiers, West Africa, Gulf of Mexico and Asia Pacific.

Infield wants to catch up with delegates and see if there is anything that the Infield System’s team can support them with at present–from client support on how to get the best from your current Infield prod-ucts and services, to new projects requir-ing project data, market analysis, market reports or bespoke consulting services.

If you are unable to visit Gastech, then Infield Systems is also exhibiting at the Pilot Share Fair in Aberdeen, Offshore South East Asia in Singapore and the Arctic Technology Show in Houston.

cryogenic and high-spec valvesAMPO Poyam Valves, a cryogenic

valves company and a reference supplier of high-specification valves, is present at Gastech with its own stand to present a selection of valves for the gas industry.

Throughout the show in stand A372, the company will exhibit a selection of products including a 10” 900# cryogenic top entry ball valve, a 20” cryogenic triple eccentric butterfly valve and a 20” 600# forged steel ball valve.

With the latest addition of the butterfly valve to the AMPO Poyam Valves product range, AMPO has reaffirmed its position as the ideal partner with one of the wid-est valve ranges of the market; cryogenic ball, gate, globe, check (bolted bonnet or pressure seal designs) and butterfly valves, high temperature metal seated ball valves, high pressure ball valves, lift plug and switch valves, jacketed valves, slurry ball and angle valves, HIPPS Service ball valves, fully welded ball valves and split body ball valves.

AMPO’s R&D team is continuously working on the development of new tech-nologies and products, in order to offer the best and most complete and reliable solu-tions to its customers. ■

Technical track focus—Tuesday afternoon, Floating LNG

Bill seMBer, ABS

sandy dunlop, Executive Administrator, Gas Processors Association-Europe

Association head eagerly anticipating CoTEs


One of the world’s leading EPC firms, CB&I has more than 50 years of experi-ence in the LNG market. The company offers a wide range of LNG technology, engineering and construction services, on a global basis.

Bruce Steimle, senior director of global marketing for CB&I, was on hand at Gas-tech to enlighten exhibition visitors and potential customers on the services offered by CB&I.

“CB&I has a full range of capabilities across the natural gas value chain, all the way from gas processing through liquefac-tion, regasification, peakshaving and stor-age,” explained Steimle. “So, we’re really trying to talk about the process side of what we do, as well as the storage side. We’ve been involved in LNG since its inception,

since 1958. CB&I built the tanks for the very first intercontinental, transoceanic shipment of LNG, in St. Charles, Louisi-ana, and over on the other side of Canvey Island in the UK,” Steimle said.

This is Steimle’s first time attending Gastech, so he was looking forward to walking the exhibition floor. “I’m keen to see what some of the other exhibitors are doing. It’s a big show. There’s a lot of people here. It’s going to be fun to walk around and see what different competitors are talking about, in terms of their capabili-ties and what they’re stressing, as well as all the different elements of vendors here. And then you’ve got the ownership side, too, so I think it’s going to be a very good show.”

CB&I’s exhibit, featuring plush green chairs, computers for client use and free-

standing photo panels of project sites, was generating good interest shortly after the exhibition floor opened to attendees at noon yesterday. Steimle noted that CB&I’s presence at Gastech provides the perfect atmosphere for prospective partners to learn more about the company.

“This year is an opportunity for us to connect with a lot of the clients that we’ve worked with over the years, as well as pro-spective new clients,” said Steimle. “So, we think that we can showcase a wide range of capabilities in LNG, as one of the industry leaders on the EPC side.”

Steimle anticipates some familiar faces at this year’s Gastech. “This is a big confer-ence for this industry, so we expect to see a lot of the folks that we know and have worked with over the years.” ■

Bruce steiMle, Senior Director of Global Marketing, CB&I

CB&I brings over 50 years of LNG expertise to GastechaDrienne Blume

Yesterday afternoon, traffic was brisk on the exhibition floor. In between all of the coming and going, the Show Daily was able to corral a few folks for comments.

Nick Brown, marine communications manager for Lloyd’s Register, said the organisation was particularly pleased to be at Gastech, taking part in this event which brings thousands of experts, clients and industry leaders under one roof.

“Gas is a fuel of the future, and we are really keen to share our knowledge and expertise with the widest audience,” he said. “We’re here to network too, which is certainly one of the great benefits of Gas-tech. For us, it’s about helping people make better decisions.

“Something else Gastech is really good for is bringing industry leaders all together, as they talk about the future of gas, and what the challenges and opportunities are. We see great benefits of being here, and we certainly plan to attend Gastech 2014 in Korea.”

Danish firm, Logstor, is showcasing its technologies that include specialized insulation for LNG pipes. “We are here, showing people what we can do and what benefits this can have for their compa-nies,” said Henk Schurink, the company’s sales manager for LNG. “We provide insulation for LNG pipes and are work-

ing on a number of LNG terminals around the world.”

“In most cases, insulation is added to pipelines after they are in place, but we provide the insulation in advance of the pipes’ installation, and this represents great benefits for companies, as well as very large savings. We hope to see a lot of potential clients, particularly explora-tion and production contractors, so we can share with them the technology.”

On the Logstor stand, visitors can see for themselves smaller scale cross-sections

of pipes that have the insulation material in place, while a large full-scale version of an insulated LNG pipe can be examined up close. “We are very happy to be here and will certainly be considering attending Gastech 2014 in Korea,” said Schurink.

Such is the recognition of Gastech’s importance to the global gas industry, it has continued to attract the biggest names, operators and organisations. “Gastech is absolutely one of the key events in the global gas industry calendar,” said GL Noble Denton’s director of marketing,

Peter Richards. “This is a great opportunity for all those within the gas industry and a great opportunity for GL Noble Denton, as we are looking to further expand our consultancy services in a number of global regions, particularly in Australia, where there is enormous potential, and in Norway.

“Being a part of these high-level debates and gaining a greater understanding of gov-ernment policies for the future is of great value. As BG Group is one of our clients, it was also very valuable to hear from Sir Frank Chapman.” ■

Out and about on the show floor

Henk scHurink, Logstor’s sales manager for LNG

nick Brown, Lloyd’s Register peter ricHards, GL Noble Denton

GE is highlighting its latest products and services for the global gas industry at Gastech 2012, being held Oct. 8-11 in London. Gastech brings together thousands of industry professionals for an exchange of ideas and to showcase the latest innovations, technologies and develop-ments across the gas value chain.

GE Oil & Gas, a leading supplier of turbomachinery solutions for the oil and gas industry, is featuring sev-eral of its key products including CNG In A Box, which allows easier adoption of compressed natural gas refueling options; the MS 5002E gas turbine, an upgraded version of GE’s MS 5002 product line offering high efficiency, low emissions and a proven service life; and integrated com-

pressor line (ICL) technology, a fully integrated system that incorporates a high-speed electric motor drive and a centrifugal compressor in a single sealed casing. Because it lacks a combustion engine, uses oil-free active magnetic bearings and operates within a completely sealed case, the unit produces no direct CO2 emissions and leaks no methane into the atmosphere.

GE also is highlighting its capabilities in the LNG sector, including floating LNG. The company recently announced it will supply its turbine-driven compressor train technology to Malaysia’s national oil and gas com-pany Petronas for an FLNG facility that is being devel-oped off the coast of Malaysia. The facility will be the

first FLNG operation for Petronas and the world’s second such plant, along with Shell’s Prelude FLNG operation off Australia. GE is supporting both FLNG projects.

At Gastech, GE also announced it is providing gas com-pression trains for Cheniere Energy’s Sabine Pass lique-faction expansion project in Louisiana. This project will transform the existing Sabine Pass import terminal into the first LNG export facility constructed in North America to take advantage of recent shale gas discoveries.

Among the products featured by the GE Oil & Gas Global Services unit is Micro LNG, an integrated plant that meets the small-scale LNG requirements of powering remote industrial and residential locations. ■

GE featuring broad scope of capabilities


Scenes from Gastech

This crowd was attentive during the speech by Rt. Hon. Edward Davey, Secretary of State for Energy & Climate Change.

During Sir Frank Chapman’s speech, the crowd was dialed in.

A crowd shot from the Monday morning session.

ExCel London was finishing up prepara-tions for the exhibition Monday morning.

The delegate lunch was a luxurious and relaxing affair.

Gastech Event Producer kate cHeetHaM (on the right), along with a colleague, have been welcoming speakers to the Speakers Lounge. The Speakers Lounge is on the third floor of the conference area.

If you haven’t figured it out already, this sign can help you get your bearings, reaffirming that you are indeed at Gastech.

Turnout was strong for the VIP breakfast.

Delegates confer on Monday morning.

janine Mcardle, Apache Corp., was a featured panelist Monday afternoon.

The crowd was excited before the official ribbon cutting ceremony.

The United Kingdom.Powered by Norwegian gas.

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Date post:	16-Jan-2016
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Gastech 2012 Day Two (1)

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